Update: CA losing venture steam?

The key insight this week

One of the biggest stories of 2021 was the geographic diversification of venture capital. Industry observers were inundated with headlines about Boulder, Austin, and of course Miami's growing venture ecosystems starting to really compete with California.

The data mildly agrees. California's share of all seed rounds on Carta has dipped to 32% in 2022, a far cry from the 41% the state received in 2019. We see a similar pattern in Series B and Series C rounds.

From a capital invested standpoint, California's decline is even more gradual. Indeed, in certain venture stages like Series A, California has actually seen an increase in its share of all capital invested.

As venture funding recedes through the next 6 months, it is possible that the mature Silicon Valley ecosystem holds up relatively better than other, newer hubs of capital. But the general story that venture has taken hold outside the Valley is compelling.

Note that the analysis above looks at company headquarters when judging location, not the location of the investment fund.

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Peter Walker

Carta Insights Team