From Work-Bench: The State of Enterprise Tech in NYC, 2022 Funding Report

All of enterprise software business has a nexus with New York City. I recommend reviewing the publications from Work-Bench, the NYC based venture capital whose tag line is, “We invest in game changing enterprise startups.” They are data-oriented people with interesting insights on funding for NYC-based enterprise tech startups.

Work-Bench has recently published “The State of Enterprise Tech in NYC: 2022 Funding Report.” You can download if for free with a registration here. It’s quite visual and a quick read.

Let’s look at the key data for last year. In 2022, $6.2B was raised in enterprise tech in NYC. This is less than half of what was raised in 2021 at $16.7B, but more than in 2020 and 2019. Total deals ere also down in 2022 to 163 from 237 in 2021.

Below is the “money chart.”

Work-Bench NYC Enterprise Software Startup Funding: 2014 – 2022

2022 funding was weaker for large growth stage rounds.

Series C and above rounds went off a cliff: 24 in 2022; 78 in 2021.

Series B increased slightly to 40 in 2022 from 39 in 2021.

Seed and Series A rounds were close to 2021 levels.

The Work-Bench report includes detailed data by round type.

The data in the report is reported by full year. I suspect that if we were to see the data by quarter we would see that the first half of 2022 was an extension of 2021 investment rates, with the second half of 2022 slower.

You can click through to the Work-Bench NYC Enterprise Tech Enterprise Tech Index. Here’s a chart from the index showing the top publicly traded enterprise companies in NYC. The first three are Datadog, MongoDB, and UIPath.

Work-Bench New York City Enterprise Tech Index Top Public Companies

Those of us in the legal tech sector see the parallel in investment to Work-Bench’s data. I keep an informal log of investment in legal tech. In that log, investments in broadly legal tech companies in the second half of 2022 were at half the rate of the first half of 2022.

A final thought from Work-Bench’s 2022 report, “There were no meaningful exits across M&A and IPOs.”

We can see now that 2021 was over-heated. We are living through the consequences of that excess growth funding now, as in the layoffs in tech companies and slowdown in M&A and IPOs.


🔥 Legal Tech: Tracking 12 Months of IPOs and Funding Rounds

A post by Artificial Lawyer provides a clear summary of the trend in the first half of 2021, “Legal Tech Funding Hits $1.4BN, While M&A Soars.” Here, James Goodnow writes about “The Insider’s View On Legaltech VC Funding,” with some salient funding insights from Kira CEO and co-founder, Noah Waisberg. Kira was recently acquired by Litera.

But the reality is that investments are clipping along at fast pace. It’s hard to keep up. I could not find a post which captured the current rounds, so I created a spreadsheet of the past 12 months of legal tech IPOs and funding rounds (Series A and higher). I’m not claiming that it is comprehensive. I’m sure that I’ve missed a few. If you have any to add or any corrections to offer, please let me know via: contact at mobilehelix dot com.

Legal Tech iPOs and Funding Rounds - 12 Months, 2021-November

On November 23, 2021, transcription company Verbit announced that they had closed $250 million in a Series E round that values the company at $2 billion. That’s after raising $157 million in a Series D in June 2021 at over $1 billion valuation, making it one of the first unicorns in legal tech. (To be accurate, Verbit serves more than the legal tech market.)

Also in November, Grammarly, another company with business in legal and beyond, raised $400 million at a valuation of $13 billion. I had to double-check that. Wow. Grammarly has a tool which corrects and improves writing.

Here’s my earlier post on unicorns in legal tech, “We have FOMO in legal tech!”