A recent report highlights that American venture investors remain cautious despite a stock market rally. According to Pitchbook-NVCA data, approximately $37.5 billion in deals were made in Q3 2024, reflecting a nearly 32% decline from the previous quarter. The lack of liquidity has led investors to demand tougher terms from startups, delaying funding until conditions improve.
OpenAI stands out in the venture capital space, having recently secured $6.6 billion in funding, raising its valuation to $157 billion. Experts suggest that while dealmaking has slowed, potential interest rate cuts by the Federal Reserve could stimulate activity in the venture capital sector.
Meanwhile, KWESST Micro Systems Inc. announced a consolidation plan for its common shares, aiming to comply with NASDAQ's minimum bid price requirements. This consolidation, subject to TSX Venture Exchange approval, will reduce the number of outstanding shares significantly, enhancing the company's compliance and market standing.
In a notable development, buy-now pay-later firm Zilch reported its first quarterly profit and is gearing up for a potential IPO. The company plans to double its workforce in the UK and is considering both London and US markets for its public listing. CEO Philip Belamant emphasized the need for better incentives for UK businesses to list domestically, as current policies may deter local IPO activity.
As the UK government pushes for reforms to invigorate its capital markets, including changes to the FCA's listings regime, Zilch's success could serve as a catalyst for increased IPO activity in the region.