2022 Is The Year Emerging Markets VC Comes Of Age. Here’s Why:

Recently listed #12 on Heritage Foundation’s list of Most Free Economies, Georgia has modernized its economy, raised its profile with recent startup exits, and is fast emerging as a dominant tech hub for Eurasia.

In Catapult’s last monthly update to investors, we offered recent market data evidencing three important venture trends:

(1) a dramatic acceleration in the amount of capital being deployed into smaller ecosystems outside the ‘big three’ US tech hubs of Silicon Valley, NYC and Boston;

(2) a ten-year low in the percentage of all U.S. venture funding deployed going into Silicon Valley companies; and,

(3) a boom of newly formed venture funds that have a defined geographic focus.

In response to these trends, we ask the overriding question that these data points suggest: Is 2022 the year Emerging Markets-focused VC funds come of age? We believe the answer is yes. Here are reasons why:

1. The Pandemic-fueled Dispersion of Talent is Here to Stay

As capital for credible founders became more accessible in recent years, the battlefield shifted. The fiercest competition between startups today is over talent, not capital. Over the past decade, engineers and operators led a not-so-quiet exodus out of high-priced tech hubs and repotted themselves in smaller markets — the Nashvilles and Miamis of the world — where they could ostensibly enjoy big city salaries while living in low tax (or no…