Low-value venture capital (VC) funding deals (investments less than or equal to $10-million) volume also shrank as overall VC funding activity in the Internet of Things (IoT) space declined during 2020 compared to 2019.
The share of low-value deals as a proportion of total deal volume also declined. However, it continued to account for a dominant share, according to GlobalData, a leading data and analytics company.
An analysis of GlobalData’s Financial Deals Database reveals that a total of 709 VC funding deals (with disclosed funding value) were announced in the IoT space during 2020. This was a decline of 33,1% from 1 059 VC funding deals (with disclosed funding value) in 2019.
Similarly, the number of low-value deals also declined by 38,8% from 766 in 2019 to 469 in 2020. Although low-value deals still managed to account for the dominate share, their share as a proportion of total deal volume decreased from 72,3% in 2019 to 66,1% in 2020.
Aurojyoti Bose, lead analyst at GlobalData, comments: “The ongoing Covid-19 pandemic has slowed down deal-making across all sectors. Although few VC firms have shown interest in startups working in the IoT space, considering the volatile market condition, investors are taking a cautious approach.”
Interestingly, 2020 failed to attract any billion-dollar deals contrary to 2019 that witnessed two deals valued more than $1-billion.
The number of deals valued more than $10-million also decreased from 293 in 2019 to 240 in 2020. Yet, the corresponding share as a proportion of the total deal volume increased from 27,% in 2019 to 33,9% in 2020.