The number of individual deals also rose and broke the previous record, reaching over 500 in Q1 2022. The increase is likely to continue to trend higher as the space is attracting new funds from Bain Capital and Sequoia Capital, long-time venture capital firms in traditional markets.
One issue intensified by all this capital investment is the need for people and talent in the blockchain space. As more companies have plans to expand, create new products, and diversify their organizations, employees with the right skills are becoming harder to find.
This, however, presents an opportunity to people who may be interested in building a career in the blockchain industry.
Some startups, especially in Africa, are taking the lead when it comes to training blockchain developers, as is the case with Web3 Student Developer Clubs in Kenya that is offering blockchain development training to grow the skilled talent pool on the continent.
The industry also saw consolidation through acquisitions by long-time crypto players like OpenSea, Coinbase, Fireblocks, FTX and Blockchain.com.
In terms of sectors, Web3 was the most attractive to investors during Q1 2022, CeFi continues to be the least active in terms of the number of deals and capital inflows of all the different sectors.
Here is a breakdown of the sectors in terms of number of deals:
Web3 – 26.5%
DeFi – 23.2%
Infrastructure – 19.5%
NFT – 18.3%
CeFi – 12.5%
Pre-seed and seed rounds had the most VC activity at 288 individual deals with over $2.1 billion. Expansion rounds did not see as much activity but recorded over 2.5x the capital inflows at almost $5.8 billion.