The Bay Area’s startup engine might be sputtering. Venture funding for companies fell to a five-year low and the size of deals has dropped to a level last seen in Q3 2014.

In Q1 2016, $6.1B was invested in venture-backed companies, according to PitchBook data in the Silicon Valley Business Journal. This represents a 28% drop from Q1 2015. The number of deals fell by about 43% to 370 in the same period. The drop-off is occurring in early stage transactions. PitchBook vice president Adley Bowden says this marked the start of the much-feared Series A and B (early stage) funding crunch. In Q4 2015, startups were more affected in San Francisco than Silicon Valley.

The drop in funding is being driven by VC restraint. VCs raised more money in Q1 2016 than they have since PitchBook started recording in 2000. Though there is a lag between when VCs raise capital and when they receive those funds, Bowden noted "there is still a ton of dry powder in the form of fresh venture capital money.” [SVBJ]