• In the second quarter, the report discovered a 4% year-over-year surge in the number of pitch decks sent by founders.
  • DocSend’s mid-year 2023 analysis reveals a growing founder-investor disparity in startup fundraising.

A recent study by DocSend Inc., a company under DropBox Inc., reveals a growing gap between founder and investor activity with the ongoing slump in venture capital funding.

It is well known that venture capital funding is declining. VC funding decreased 49% in the second quarter compared to the same period last year, according to a recent report from Crunchbase. Pitch activity, such as the number of startup founders creating pitch decks and the response rate, has not been as thoroughly documented.

The startup fundraising landscape is exhibiting a growing divide between founder and investor activity, according to DocSend’s mid-year 2023 Pitch Deck Interest metrics analysis. While the number of pitch decks distributed by founders increased in the second quarter, the study found that investor interest in these proposals had decreased. According to the report, this indicates that founders’ efforts to raise money are becoming more complex.

According to the report, the second quarter saw a 4% year-over-year increase in pitch decks sent by founders but a 4% decrease in investor engagement with these decks, both quarter-over-quarter and YoY. According to DocSend, the expanding gap indicates that investors are becoming more selective and diligent, which gives them an advantage during the deal-making process.

The early-stage fundraising market was found to be impacted by seasonality, with activity typically slowing during the northern summer and other holiday times. According to DocSend’s metrics, the amount of time investors spend reviewing pitch decks has decreased by 4% quarter-over-quarter and 7.7% over the past year over year, which means founders have less time than ever to catch the interest of potential investors.

When comparing the numbers to 2021, the difference is even greater. The second quarter of 2022 saw a 15.9% increase in founder activity compared to the same period in 2021 but an 11.5% decline in investor activity.

Justin Izzo, Data and Trends Analyst at Dropbox DocSend, said, “All three of DocSend’s historical metrics point clearly to an investor-friendly marketplace at this time. Due to continued macro concerns as well as the usual seasonal lull, fundraising dollars may be challenging for fundraising founders to come across in the near future.”

Although the report focuses on the bad aspects of the broader VC industry downturn, it does point out that investors are still reviewing pitch decks, albeit more slowly than the capital invested, despite the depressing fundraising numbers.