But as we slide into 2024, the numbers are really starting to catch up. I’ve been sifting through the data of PitchBook’s new 2023 report, and it offers a comprehensive look at how damaging the rise of interest rates has been on the venture capital market. This downturn has been defined by an utter dry-up of exits and a mismatch in perception of what private companies are really worth. Limited partners are getting less in distributions than they have in more than a decade, according to PitchBook. The prolonged closure of the IPO market and a pullback in M&A have caused a clog in the system, leading to fewer deals, smaller checks for funding, and more layoffs at startups. 

Let’s start with this chart, which offers a pretty telling view of some of these new realities: 

As you can see above, there was only $61.5 billion retrieved from exits in 2023, according to PitchBook. Ten years ago, in 2013, there was $75 billion. 

Now here’s a look at valuations: 

The question of the hour seems to be whether we’ve hit the bottom of startup valuations or not. After all, they have fallen significantly from 2020-2021 levels, but not much further, making it unclear whether the impact of the aforementioned lack of exits has fully made its way through the system yet or not. Investors disagree on this point, as was made crystal clear from the 2024 predictions you shared with me at the end of last year.

Here’s another:

The weight of the downturn has been felt in the latest stages of the private markets, where the IPO market’s closure has had the most impact. And also in mega-deals—a phenomenon that became almost commonplace during the boom of 2021, when there were 843 funding rounds of more than $100 million in the U.S., according to PitchBook. Those deals have steadily declined since, with 269 in 2023. That figure is similar to the number of mega-deals in 2019, when there were 262 deals completed of over $100 million in capital, according to PitchBook.

Some good news for all you optimists out there is that companies founded by women are still raising much more capital for their companies than they were pre-COVID. Take a look: 

I will note that—although there is more capital going into women-founded companies these days—fewer deals are actually getting done, echoing the broader industry. There were 3,266 deals for companies with at least one woman founder in 2023—down from 4,458 in 2022, according to PitchBook.

How are you feeling about it all? You can share by taking Semaphore’s confidence survey. Every year, Term Sheet partners with Semaphore to survey private equity, venture capital, hedge fund, entrepreneurs, and other professionals and get a sense of how you’re feeling about your industry, your firm or company, and yourself. Plus a few other things, such as whether you think Sam Altman should be running OpenAI today or not. Weigh in, if you like. It’s anonymous and should take you 3–4 minutes. You can take the survey here. Have a look at last year’s results here, here, and here.

See you tomorrow,

Jessica Mathews
Twitter: @jessicakmathews
Email: jessica.mathews@fortune.com
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Joe Abrams curated the deals section of today’s newsletter.

VENTURE DEALS

- Prometeo, a platform designed to connect corporations with financial institutions in Latin America, raised $13 million in Series A funding. Antler Elevate led the round and was joined by PayPal Ventures, Samsung Next, and others.

- Rune Labs, a San Francisco-based provider of precision neurology software and data, raised $12 million in funding. Nexus NeuroTech Ventures led the round and was joined by existing investors Eclipse, DigiTx Partners, Moment Ventures, and TruVenturo GmbH.

PRIVATE EQUITY

- BlackRock agreed to acquire Global Infrastructure Partners, a New York City-based infrastructure investment firm, for $12.5 billion.

- Sovos, backed by TA Associates Management and Hg, acquired Aatrix Software, a Grand Forks, N.D.-based provider of payroll tax reporting software. Financial terms were not disclosed. 

EXITS

- MadCap Software, backed by Battery Ventures, acquired Xyleme, a Denver, Colo.-based provider of content management solutions for enterprises, from Bow River Capital. Financial terms were not disclosed. 

OTHER

- Enlightenment Capital, a Washington, D.C.-based investment firm, merged together four of its portfolio companies, including Boecore, Ascension Engineering Group, Orbit Logic, and La Jolla Logic, into Auria, a Colorado Springs, Colo.-based software and products provider for space, national security, and cyber missions.

IPOS 

- Alto Neuroscience, a Los Altos, Calif.-based biopharmaceutical company developing depression and schizophrenia treatments, filed to go public. Alpha Wave Ventures, Apeiron Investment Group, Amit Etkin, and Dan Segal back the company.