The primary fundraising environment remains challenging, though the recent IPOs have perhaps spurred some renewal and activity.
Coming off the low in Q1 2023, where the aggregate money raised and total number of deals in the period hit five-year lows, Q2 and Q3 were both modestly better. But the nature of funding is changing. Down in flat rounds as a share of all rounds are increasing. Additionally, as a new chart in the Forge Investment Outlook shows, investors are also able to demand and receive better terms and stronger protections that were far less common in previous years.
This chart shows the percentage of rounds with liquidation preference multiples greater than one. So we're talking about, in an exit event, investors that will receive a multiple of their initial investment before common shareholders receive any payout. So, what we see here is that in 2020 and 2021, the percentage of rounds with liquidation preferences were very low. 0.6% and 0.3% of primary funding rounds had multiples greater than one.
In 2022, this number rose to 1.3, which was higher, but similar to 2019. But in 2023 so far, this has grown to 5.9% of all new rounds, nearly four times higher than in 2019, the highest of the previous four years. What is also interesting is that we're seeing this on both up and down rounds. So, some investors are willing to pay a higher price for new company shares, but are requiring a liquidation preference multiple for doing so.
If we often think of up rounds as a measure of a positive fundraise, this chart caveats that a little, showing that recently, even some up rounds have characteristics reflecting a weaker company bargaining position and a stronger investor. Perhaps some of these up rounds are not quite as glowingly positive as we might otherwise think.