Venture capital investment marked its lowest in Q3 2022 since the first quarter of 2020 when the world was just entering into a pandemic and only $19.6 billion was raised by startups in the region.

Funding sank to its lowest level in 10 quarters, a trend not unique to only Asia, largely driven by a drop in late-stage funding as the region felt the full effects of the current private market pullback.

The number of investment deals also saw a decline as only 1,417 deals were announced in Q3 2022, down 18% from last quarter and 22% from a year ago.

The late-stage funding round led the drop, with the total funding in the late-stage and technology growth round reaching only a combined $9.2 billion, a 42% drop from last quarter's $15.9 billion and a 71% drop from Q3 last year. Deal flow during the period also dropped by one-third from the last year's quarter which had well over 200 funding deals closed.

The early-stage funding round saw a fall in Q3 with $10.4 billion raised, a 28% drop from the $14.3 billion in Q3 last year and a 3% drop from the previous quarter. Deals completed in the early stage also took a beating, falling 22% to 497 from the previous quarter.

Chart: Emmanuel Oyedeji / | Source: Crunchbase (September 2022)

The Seed/Angel round was not left out with just over 750 deals completed in the round. Funding also went down to $1.6 billion, 23% from the last quarter—although up 13% from the same quarter last year, the effort was inconsequential in changing the direction of the crashing total funding swing.

Mirroring the trend that has been going on in the global markets, with funding to private companies slowing down, other regions, including North America and Europe, have also seen investor funding plunge in Q3 2022.