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As the number of unicorns reached a new record high, there was also a surge in the number of megarounds, which are startup funding rounds of over $100 million.
Compared to previous years, 2021 saw the highest amount of money invested by venture capitalists in startups. This came at a troubling time when the pandemic was resilient, affecting the global economy. In 2021, venture capitalists invested over $675 billion in global startups despite the persistent worldwide health crisis. On the 13th of January, data published by VC analysis firm Dealroom and British promo agency London & Partners stated that the amount of money venture capitalists invested in 2021 was X2 of the money invested in 2020. Notably, funds invested in startups worldwide in 2020 were at an all-time high.
Despite the pandemic, it appeared that investments in startups continued to get better as there was an increase in the numbers of “unicorns.” Interestingly, 133 startups in the San Francisco Bay Area grew to unicorn status, with their valuations exceeding $1 billion. In addition to the numbers of startups that attained the unicorn position, there were 69 in New York, 21 in Greater Boston, 20 in London, 16 in Bengaluru, and some 15 in Berlin.
Unicorns and Megarounds Reached New Highs in 2022 Due to Venture Capitalists Investments
As the number of unicorns reached a new record high, there was also a surge in the number of megarounds, which are startup funding rounds of over $100 million. Megarounds increased significantly in some cities, with some seeing more than a X2 jump. Dealroom revealed 64 megarounds in London in 2021, representing a X3.4 rise over 19 recorded the previous year. As financial technology company Revolut generated $800 million in a Series E round last year, Monzo also secured more than $600 million from two deals in the same year. Additionally, online events platform Hopin raised some $850 million across two deals in 2021.
In summary, London startups gathered $25.5 billion from venture capitalists in 2021. This is more than a double jump from $11.2 billion in 2020. As such, London now has more than 75 unicorns. Some of the new companies with the achievement include mobile banking app Starling Bank and Marshmallow.
The UK’s 2021 financing round success story has attracted comments from industry leaders. The CEO of London & Partners, Laura Citron, commented:
“We have big pools of later stage funding, nearly two new unicorn companies every month, and massive funding rounds and exits. This data shows that London is not only a brilliant place for entrepreneurs to start businesses, but also to grow them to a global scale.”
Despite the high investments in the UK by venture capitalists in 2021, there were more resounding investments in the US. In the last year, venture capitalists pumped $328.8 billion into startups in the US. Also, the investors injected $61.8 billion into Chinese startups in the same year. Meanwhile, the UK recorded $39.8 billion invested in startups last year.