The Austin area saw a huge slowdown in venture capital invested in the fourth quarter with $775 million flowing into 78 deals, according to PitchBook-National Venture Capital Association Venture Monitor data.

That is down 50 percent in dollars invested from the fourth quarter of 2021 which recorded $1.5 billion in 122 deals, according to the Pitchbook report. It is also a 36 percent decline in the number of deals being done.

The data comes from the Q4 2022 PitchBook-NVCA Venture Monitor, jointly produced by PitchBook and the National Venture Capital Association with support from InsperityJ.P. Morgan, and Dentons.

“After years of frenzied investments and soaring company valuations, venture capital investment levels are readjusting as businesses assess the current economic landscape,” according to the report.

Despite the fourth quarter slowdown, overall, for 2022, the Austin area still had a phenomenal year with $4.9 billion of venture capital invested in 416 companies.

That’s on par with stats from 2021 when Austin had a record-breaking year with $4.9 billion in venture capital investments. And it’s actually an increase in deal flow by nearly 7 percent from 387 companies in 2021.

Overall, companies in Texas raised $1.6 billion in venture capital in the fourth quarter of 2022, in 180 deals. That is down nearly 56 percent from $3.6 billion in the fourth quarter of 2021. And down nearly 34 percent in deal flow from 271 deals in the fourth quarter of 2021.

For all of 2021, Texas companies raised $9.5 billion, down nearly 20 percent from $11.9 billion raised in 2021. Deal flow also dropped 16 percent in 2022 to 840 companies funded, down from 1,004 in 2021.

In Austin, the biggest deals in the fourth quarter went to Jasper, a content generation platform, that received $141 million in venture funding. The Series A round made Jasper Austin’s latest Unicorn company valued at more than $1.5 billion. Jasper is one of the startups developing conversational AI and image generation AI similar to Open.AI’s ChatGPT. Its investors include Insight Partners, Coatue, Bessemer Venture Partners, IVP, Foundation Capital, Founders Circle Capital, HubSpot Ventures and more.

The second largest deal went to Infinitum, based in Round Rock, which is developing motors and generators powered by its patented technology. It raised $110 million in a Series D round. Its funding came from Riverstone Holdings Latin America, Alliance Resource Partners, Caterpillar Venture Capital and Cottonwood Technology Fund. 

And rounding out the top three deals is Dabbsson, which has created a clean energy backup generator for homes. It landed $75 million.

Top 10 Venture Capital Deals in Austin in 2002 Q4

  1. Jasper, an AI content generation platform, $141 million
  2. Infinitum, develops motors and generators, $110 million
  3. Dabbsson, alternative clean energy equipment maker, $75 million
  4. Setpoint, real estate fintech and software platform, $43 million
  5. SubjectWell, clinical trial, and patient matchmaker platform, $35 million
  6. Way, a software platform for curating experiences for hospital brands, $20 million
  7. Flueid, a software platform to automate title and escrow closing practices, $20 million
  8. Maergo, shipping and logistics platform for retailers, $20 million
  9. Keystone Bank, banking services, $18 million
  10. Beatbox Beverages, ready-to-drink alcoholic punch, $16 million