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South Florida VC fundings in Q4 rose, but results for 2023 are a 3-year low

Nancy Dahlberg
Nancy Dahlberg
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By Nancy Dahlberg

A big rebound just wasn’t in the cards for South Florida’s 4th quarter venture capital results but the quarterly total of $544 million was the best result of the year, according to Q4 Pitchbook data used in the Q4 Pitchbook-NVCA Venture Monitor report that was released today. Still, for the year, venture capital flows were down significantly in the Miami-Fort Lauderdale metro area compared to the record-setting 2022, showing that funding into South Florida startups flew higher in 2022 while most other tech hubs showed declines but fell much harder than the US as a whole in 2023.

The South Florida picture

For Q4 2023, Pitchbook reported that the Miami-Fort Lauderdale metro pulled in $544.1 million across 92 deals, up from the Q3 total of $479 million across 69 deals, and down just slightly from the $556 million raised across 93 deals in Q4 of 2022, according to underlying data provided to Refresh Miami. By deal value, South Florida ranked No. 9 in the nation for the quarter.

For the year though, South Florida logged just under $2 billion across 375 deals, a 66% drop from 2022. Given the venture winter and inflation trends, the FTX fallout and the SVB collapse, the downturn last year was expected, but still shocking, after the region pulled in record totals in 2021 and 2022. By my reporting, the metro area pulled in $5.8 billion in 2022, ranking 7th in the nation. This year was the lowest year since 2020, and the Miami-Fort Lauderdale metro area fell out of the top 10.

South Florida startups bucked the trends, showing strength amid the down market. According to Pitchbook’s data, here were the top deals by companies headquartered in the Miami metro area in Q4:

  • MaintainX: A Miami-based later stage business productivity software company, raised $50 million Series C.
  • Forward Therapeutics: The yount Palm Beach Gardens-based drug discovery company raised $50 million Series A round.
  • Florida One Insurance: The Miami-based later stage financial services company raised $47.9 million.
  • Cast AI: The Miami-based AI powered cloud cost optimization software company raised a $35 million Series B round.
  • Sage Intel: The Miami-based fintech raised a $30 million Series A round.

Notably, this is the first year since 2015 when our region did not have even one equity mega-round, or a round of $100 million or more. In our region’s record-smashing 2021 and 2022, the region logged 10 and 12 equity megarounds respectlively, including eye-popping raises by Yuga Labs, Moonpay and Flow. Those rounds alone made up the majority of funding those years.

There were four exits for South Florida companies in Q4, but only one with a deal value. That would be the $41 million IPO for Sucro, a food products company based in Coral Gables, , according to Pitchbook.

Venture reporting lags and errors will be corrected resulting in revisions in all of these figures over the coming months, but this  provides a snapshot of how South Florida stands now. I am working on my full-year report with eMerge Americas in which I analyze data across several sources, and my preliminary 2023 findings for the South Florida MSA’s deal value and deal count are higher, but not significantly. Finally, my data shows that fintech remained South Florida’s strongest sector, with medtech in second place, in the year 2023.

Keep up with #MiamiTech venture news and more on Refresh Miami’s new Miami Tech Dashboard. The resource is the place to go for Dealroom data on startups and funding rounds, investors, ecosystem organizations, academic institutions and more – and it is free to the community. 

The Florida picture

Statewide, according to Pitchbook’s report, Florida companies drew $715.4 million across 135 deals in Q4 2023. That was up from a revised $682.1 million across 128 deals in Q3. South Florida companies drew 76% of the state’s venture dollars in Q4 and more than 69% of the deals. Tampa Bay area companies raised $95.1 million across 14 deals and Orlando startups picked $32.3 million across 6 deals. For the state, Funnel Leasing of Tampa Bay, a $32 million raise, was the only top five raise that wasn’t in South Florida.

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For the year 2023, companies in Florida pulled in just under $3 billion across 598 deals, according to Pitchbook’s data. Tampa Bay metro area companies raised $307.7 million across 72 deals and Orlando MSA startups bagged $164.3 million across 39 deals.

The national picture

In 2023, US VC deal activity continued its slump from the highs two years ago. Just 15,766 deals were completed, and only $170.6 billion was invested into companies, falling 30% from 2022’s total and is roughly half of the amount invested in 2021. It should be noted that 10 percent of 2023’s deals were the result of two companies: Anthropic and OpenAi, which together raised nearly $17 billion.

What’s more, exits returned just $61.5 billion to investors during the year, which was at least a decade low. Large tech IPOs were especially sparse considering the high number of unicorns that remain private, Pitchbook reported.

“The overall outlook for US VC in 2024 is for the market to remain relatively subdued,” the report said.

Yet, it’s not all doom and gloom. “While the continued drop in activity does not lend itself to optimism, it would be a mistake to declare the market in crisis,” said NVCA President and CEO Bobby Franklin in the Venture Monitor report.

The VC landscape shifted because  of factors such as heightened political risk and evolving dynamics in global supply chains since early 2022, Franklin said. But there were also positive national trends, with investments surging into advanced technologies. Plus, VC deal count was still higher in Q4 2023 than in any quarter in the pre-2020 days.

“The industry is extremely well capitalized, and advances in AI, life sciences and clean tech are all attracting significant levels of public and private investments,” Franklin said.

Although VC is increasing outside the big 4 tech hubs – SFBA, NYC, LA and Boston – it’s slow going: New graphics in the report showed that companies outside the major tech hubs of the SFBA, NY, LA and Boston lured only half of the deals and 32% of venture dollars.

And in another continuing trend, all-female founded teams raised just $3.1 billion in 2023, which was 2% of the total deal value, the lowest it has been on record. Teams with at least one female founder raised $33 billion, 20.7% of the total, the highest it has been on record, accoring to Pitchbook.

Download the Q4 2023 Pitchbook-NVCA Venture Monitor report here.

Follow Nancy Dahlberg on X @ndahlberg and on LinkedIN. You can reach her at nancy@refreshmiami.com

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