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FinTech firms are increasingly focusing on profitability, turning away from the growth-at-all-costs strategy many have long pursued.
According to some investors, this strategic pivot from growth in favor of profits is necessary to win back cautious investors who are more focused on unit economics now and no longer swayed by a firm’s growth potential. READ MORE
Angel investors and venture capitalists tend to operate in the same circles. While both invest in startup companies and new technologies, they're otherwise very different. An angel investor is generally an individual looking to invest their own money in a startup business. A venture capital firm is a group looking to invest its clients' money in new companies. This leads to stark differences in how these investors operate. READ MORE
Artificial intelligence has been a hot topic in recent months thanks to OpenAI’s ChatGPT. While everyone is marveling at the technology for passing law exams, AI has long had the ability to feed us.
Source.ag, a Netherlands-based agriculture tech startup, announced on Thursday it raised a modest $23 million Series A funding round for its AI platform that predicts the best growing conditions for greenhouse plants. READ MORE
“We’re letting the market price this round.”
This line is often fed to founders in preparation for the notoriously tricky valuation question. READ MORE
Like all industries, venture capital is not immune to the overall market uncertainty that dominated the second half of 2022 and has now spilled into 2023.
According to research firm Preqin, venture capital investments last year experienced the sharpest drop in 20 years, equating to a year-over-year difference of $286 billion. On a global scale, deal executions were down a staggering 42% in the first three quarters. These significant dips in activity indicate that investors continue to be more cautious with their money. READ MORE
In 2021 it may have seemed any startups could raise $100 million at the snap of its fingers — but the last year-plus is forcing some to find more creative ways to raise rounds and even contemplate the once taboo “down round.”
Last year ended with a slew of unicorns announcing deals that sliced into their valuations and the start of this year brought similar headlines, with reports that highly valued startups such as payments provider Stripe and online prescription delivery company Capsule are looking to raise down rounds due to market conditions. READ MORE
If there's anything we know about the tech ecosystem, it's that the only constant we can rely on is change. While startups everywhere have longed to be named the next unicorn, yearning to be the next camel company in 2023 will prove its worth.
Camels know how to play the long game. They are resourceful, balanced, resilient and, most importantly, real. Unicorns are imaginary animals living in a world of myths and legends, and I believe coining a startup term in their honor feels—to put it bluntly—deceptive and misleading for founders. READ MORE
Paging first-time, early-stage entrepreneurs. It’s time to think strategically about how you want to fund your business. How you bring money into your business affects basically every important aspect of your startup experience: READ MORE
A Delaware Court has issued a partial victory to insurers in one of the first directors and officers liability insurance coverage cases related to special purpose acquisition companies to reach a ruling.
Social Capital Hedosophia Holdings Corp. III was a publicly traded SPAC that merged with privately held Clover Health Investments Co. in January 2021, according to the Feb. 6 ruling by the Delaware Superior Court in Wilmington in Clover Health Investments Corp. et al. v. Berkley Insurance Co. et. al. READ MORE
What’s the latest in SPAC litigation and enforcement? To find out, I recently spoke with two experts from the Dallas office of Holland & Knight, a prestigious multinational law firm.
Chauncey Lane is a corporate mergers and acquisitions (M&A) partner, and Scott Mascianica is a litigation partner who previously worked in the Security Exchange Commission’s (SEC) enforcement division. READ MORE
Middle-market private equity firms are having to take ESG seriously, as a growing number of their limited partners are including ESG factors as a main area in their due diligence, said a new yet-to-be released survey by Apogem Capital, a manager of managers. READ MORE
Life took a big turn last May for the employees of C.H.I. Overhead Doors, in the small town of Arthur, Illinois. Every employee was a co-owner of the company. They'd been told if the business sold at a profit, they'd all get a payday. Now, it was actually happening. "I'm just upfront, being all excited," said production manager Jim Hill. "Oh my gosh, like, we're talking life-changing money now!"
Hill, who joined the company in 2019, got two-and-a-half times his annual salary. "That was, 'Hey, Jim, like, it's easier to put your kids to college now!" he said. READ MORE
Entering 2023, the private venture-backed life sciences and healthcare landscape undoubtedly looks and feels different than it did during the fast-paced, valuation-rich days of 2021. Silicon Valley Bank’s most recent Healthcare Investment and Exits report revealed that 2022 was still the second-largest year on record for venture capital investment into healthcare companies in the US, UK and EU. However, investment dollars dropped 34% from 2021’s peak, and public markets were eerily quiet, with only 31 private venture-backed healthcare IPOs versus 174. READ MORE
Startups hoping to raise a nine-figure round in the future had best temper their ambition; venture funding events worth $100 million or more are going extinct — quickly.
A few years back, nine-figure venture funding events were common. So much so that during my Crunchbase News days, we started to call them “supergiant” rounds to avoid having to spell out their size. Hell, we actually ran regular reports of rounds worth a few hundred million or more until sheer volume made it impractical. Good times. READ MORE
Raising capital is a critical challenge for entrepreneurs, and in today’s competitive market, securing funding can be more difficult than ever. With Crunchbase reporting that global venture capital funding hit a two-year low in August 2022, entrepreneurs must be prepared to go the extra mile to stand out and secure the investment dollars they need to grow their businesses. READ MORE
Silicon Valley dreams of unicorns. Thinking big fuels the entire startup ecosystem, and overall, it’s a very good thing.
But product-market fit is hard to get right. When it’s not quite there, we all know what to do: pivot. Still, not every startup is destined to go all the way, especially right now. READ MORE
American consumers are used to brands catering to our every whim.
From footwear to skincare to pets, stores and warehouses are stuffed with products targeting every conceivable demographic, however bizarre its tastes. Pet ketchup? Snail slime eye masks? Zebra print goldfish platform shoes? READ MORE
Aurojyoti Bose, Lead Analyst at GlobalData, comments: “There was a month-on-month (MoM) as well as Year-on-Year (YoY) decline in VC deal activity in January 2023 while the impact was more prominent in terms of value.”
An analysis of GlobalData’s Financial Deals Database reveals that VC deals volume in the US declined by 24.2% and 57.8% in January 2023 compared to the previous month and January 2022, respectively. Meanwhile, the MoM and YoY decline in value terms stood at 55.3% and 76.8%, respectively. READ MORE
If the last year has taught us anything, it’s that VCs let their portfolio companies get away with a lot.
No balance sheet? No problem; here’s a $32 billion valuation. No proven product-market fit and your last venture cost investors billions? Here’s a check worth more than all Black founders raised in 2021’s otherwise record-breaking year. Cut a check for Elon Musk’s Twitter acquisition when he’s never built in that space before and has a reputation for treating employees poorly, why not? READ MORE
Start-up businesses had a banner year in 2022. In contrast to the drop in venture capital funding (down 35% in 2022 to US$445 billion compared to US$681 billion in 2021), angel and seed investors made a record-breaking combined investment of US$36.2 billion in 2022, according to CB Insights.
While the Small Business Administration estimates that more than 250,000 individual angel investors provide capital for about 30,000 businesses in the U.S every year, there are also more than 250 organized angel investor groups, according to Jo Ann Corkran, co-CEO of Golden Seeds, a New York City-based angel investor group with nearly 350 members. READ MORE