Dragoneer breathes less fire as venture capital market cools

Last year’s record venture capital totals were largely driven by huge growth capital firms like world tiger and Coated flooding more money than ever into the startup space.

We have already seen how Coatue slowed down and Soft Bank had a difficult year. A large company which has not yet been examined has however been Dragon Rider. Because he’s been so quiet lately, maybe it’s easy to forget about him.

Dragoneer, which includes companies such as Ali Baba, Soft and Uber among its previous investments, dramatically accelerated its investment pace in 2021. That year, the San Francisco-based company participated in 80 different announced fundraising rounds, with those rounds totaling $28 billion, according to Crunchbase. Data.

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However, it is important to note that the amount any investor, including Dragoneer, invests as a specific stake in a round is generally not disclosed.

Some of the big rounds Dragoneer took part in last year include:

  • Co-direction Robloxfrom the $520 million Series H in January.
  • Take part in Databrick$1 billion in Series G in February and $1.67 billion in Series H in August.
  • Co-direction Fair$596.2 million Series G in November.
  • Take part in Lace$1.3 billion Series D, also in November.

This year presented a very different story. The company fell significantly as the venture capital market continued to slow each month. For nearly three-quarters of this year, Dragoneer closed just 21 deals, with those rounds totaling just over $4.1 billion, according to data from Crunchbase.

The company has not participated in an announced deal so far in the third quarter.

That doesn’t mean the company has backed out of deals, or even big deals. In January, he drove Lyra Healththe $235 million Series F, as well as SpotOn$300 million Series F in May. He also participated in Checkout.com$1 billion in January.

unicorn hunt

However, Dragoneer is about to add the least number of unicorns to its portfolio since 2020, according to data from Crunchbase. Last year, the company was one of the top investors to attract billion-plus companies when it added 35 to its portfolio. This year, that number is just eight, the same number he added in 2019.

The slowdown in the pace – and price – of deals is unsurprising given the slowdown in the venture capital market seen this year, with many saying it really started in late 2021. Dragoneer’s numbers would seem the confirm, as total deal value in the first quarter – which likely ended in the fourth quarter of last year – was down sharply from any quarter of 2021.

Many companies, especially large growth capital firms that must balance their investments in the private and public markets, have suffered significant setbacks in the venture capital market this year, inflation, interest rates and geopolitical issues that have rocked the economy.

Late-stage major growth cycles have taken the brunt of the market – a place where Dragoneer thrives – as investors seem unwilling to pay for high valuations.

Whether that changes and valuations fall or investors reopen their portfolios remains a question we may not have an answer to until next year.

Dragoneer did not respond to requests for comment.

Methodology

The total dollar amount of the rounds in which the company has participated reflects the total investment in those rounds, not the particular company’s participation in those rounds, which is not normally disclosed. All trade and trade size figures come from Crunchbase data.

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Illustration: Dom Guzman

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