Overview
GPCA’s annual Trends in Global Tech report traces venture capital flows across Africa, India, China, Southeast Asia, Latin America, Central & Eastern Europe and the Middle East.
Amidst a global tech correction, market volatility and geopolitical headwinds, overall VC investment fell by 33% from 2021’s record high, but startups still attracted over USD100b in 2022, representing the second-highest year on record. This report highlights common investment themes across geographies, as well as all-time investment records in seed and early stage rounds at a time of significant adjustments in the global macroeconomic landscape.
VC Investment in Global Private Capital Markets
Broad investor interest coupled with prudent capital deployment sparked records in seed-stage investing across all geographies, as well as early stage records for Africa, India and Southeast Asia. Overall capital invested in seed rounds rose 87% across GPC markets in 2022 and surpassed USD1b for the first time in China, India and Latin America, reflecting a broader shift by GPs going upstream and targeting earlier-stage opportunities.
While Latin America saw a 51% contraction in total capital invested, the total number of deals in the region increased by 22%, also accelerated by seed-stage investing, which reached USD1.1b for the first time on record, a 68% increase from USD657m in 2021.
Seed-stage and early stage investments followed a similar trend in Southeast Asia and India, with seed-stage dollars increasing by 73% and 39%, respectively, and early stage financing growing by 23% and 14% compared to 2021.
Investment in the Middle East bucked the slowdown in other markets and surpassed USD2b, driven by late-stage rounds in Kitopi (food delivery), Pure Harvest Smart Farm (agtech) and FOODICS (enterprise software).
Late-stage financings saw the largest adjustments across our markets. Latin America was the most impacted market, with a 79% drop from 2021, followed by India and Africa with declines of 59% and 58%, respectively. With limited late-stage capital availability, startups opted to raise non-dilutive capital to support their operations, with venture debt financing seeing positive growth across all GPC markets, except India and CEE. Notable venture debt rounds included:
- Latin America: Keo World (USD500m), Nelo (USD100m), Stori (USD100m)
- Southeast Asia: Traveloka (USD300m), Kredivo (USD145m)
- China: FundPark (USD250m), Animoca Brands (USD110m)
- India: Stashfin (USD200m)
- Middle East: Tabby (USD150m)
GPCA Data Pack
GPCA Members can log in to download the accompanying GPCA VC Data Pack for 2022 VC fundraising and disclosed fund closes; exit totals and highlighted exits; disclosed investments over USD15m, sortable by stage, sector and HQ; as well as most active investors, fastest growing sectors, stage analysis, global investor participation and more.
Top Sectors Across Markets
Fintech remained one of the most attractive tech verticals for investors, particularly in Africa and Latin America. Investors closed 1,000 transactions and deployed nearly USD16.7b into fintech startups across GPC markets, fueled by increased interest in innovative business models ranging from working capital origination for SMEs to open banking and digital wallets. In addition to the sustained interest in fintech opportunities across GPC markets, other verticals like computer hardware, gaming/media and agtech all posted year-over-year gains in VC investment value and deal count.
China continued to lead in biotech, semiconductors and EV investment across all markets. Biotech rounds accounted for 18% of all Chinese VC investment, led by Zhejiang Decans Medical Equipment (USD500m) and Beijing LIFE Biosciences (USD244m), while EV investment accounted for 16%, led by Sunwoda Electric Vehicle (USD1.8b) and RT Advanced Materials (USD742m).
While cleantech is still not on the map of most active sectors for most geographies GPCA covers, in China we noted four rounds over USD100m for Chint Anneng Power System Engineering (~USD580m), WeView (~USD568m), Gokin Solar (~USD358m) and Hithium(~USD277m).
Africa saw the second largest year on record for VC investment with USD2.7b capital deployed in 2022, only 12% down from its all-time record of USD3.2b in 2021. Healthtech was one of the fastest growing sectors in the market with USD114m deployed across 26 deals led by Nigeria-based Reliance Health’s USD40m round.
- Notably, enterprise software is the only sector of interest that has captured a significant share of investment across all geographies. Edtech remains undercapitalized across all markets.
VC as % of Total Private Capital
Venture capital represented nearly half of all private capital invested across GPC markets (48%) in 2022, holding steady during a time of significant global macroeconomic adjustments, compared to 56% in 2021. While VC investment as a proportion of total private capital remained consistent in the Middle East, Africa, Southeast Asia and China, VC fell to the second position in Latin America, capturing 28% of all private capital in 2022, after a surge in private credit, infrastructure, telecommunications and renewable energy investing.
Top Countries for VC Investment
While VC investment across top countries in GPC markets has contracted from the outlier capital flows seen in 2021, most of the top 13 countries still experienced triple-digit percentage investment growth in 2022 compared to 2020. Notably, VC inflows in China reached USD48.8b, almost on par with the USD50b invested in 2020, while India saw the second largest venture deal on record in our markets in 2022, with DailyHunt’s USD805m financing.
While Turkey’s investment growth in 2021 was propelled by mega-rounds including Trendyol’s USD1.5b, venture investment still grew 765% in 2022 compared to 2020, driven by Getir’s USD768m new financing, as well as big tickets for Dream Games (USD255m) and Insider (USD121m).
Saudi Arabia’s investment has rapidly increased since 2019, with a healthy diversification of early and late-stage financing rounds from both global and local investors. The country’s dramatic investment growth of 980% in 2022 was driven by eight rounds commanding ~80% of all capital, out of which six constituted early stage investments: Tamara (USD100m), Zid (USD50m), Classera (USD40m), Retailo (USD36m), Lean Technologies (USD33m) and Manafa (USD28m).
Notable Tech Exits
VC-backed exits fell from USD74.6b in 2021 to USD20.5b in 2022 as public market sentiment turned against tech listings and geopolitical conflict froze liquidity events in CEE. While notable public market listings still occurred, including United Imaging Healthcare (China), GoTo (Indonesia), Swvl (Egypt) and Anghami (Lebanon), a large number of companies postponed listing plans pending market stabilization. Other investors leveraged strategic sales like SoFi’s acquisition of Argentina-based Technisys and Zomato’s buyout of India-based Blinkit.
Methodology
GPCA’s venture capital (VC) investment dataset includes seed, early stage and late-stage investments with participation by blind-pool VC funds backed by institutional investors. Stand-alone investments by accelerators, incubators, angel investors, corporate or strategic investors and government-guidance funds are not included in current reporting but may be incorporated in subsequent releases. Investment totals reflect the total transaction value for each deal — including co-investments from institutional and strategic investors.
For more information on research methodology, please visit GPCA’s data methodology page or contact research@gpcapital.org.
GPCA Data Pack
GPCA Members can log in to download the accompanying GPCA VC Data Pack for 2022 VC fundraising and disclosed fund closes; exit totals and highlighted exits; disclosed investments over USD15m, sortable by stage, sector and HQ; as well as most active investors, fastest growing sectors, stage analysis and more.
Additional Reading
2023 Industry Data & Analysis
2022 Southeast Asia Startup Directory
LAVCA 2023 Industry Data & Analysis
LAVCA 2023 Trends in Tech
LAVCA 2023 Startup Founders Survey