We know there has been an ongoing slowdown in venture capital funding for startups - this has been the case since 2022 and it continues to impact startups at all stages of growth. The slowdown appears to be leveling from 2022, however, suggesting that the market may be normalizing. Furthermore, investors are still active in certain key sectors and notable trends are beginning to emerge in the landscape this year. READ MORE
The Biggest Startup IPOs Of The Past 10 Years Are All Below Their First-Day Price
Venture capital is a hits business. It’s OK if most of your companies flounder or fail, so long as a few go on to monstrous valuations.
The trouble is, success requires some home runs. And, if we take the long view over the past 10 years, those haven’t panned out as hoped on the public markets. READ MORE
U.S. SEC adopts new rules around private fund disclosures, share buybacks
The U.S. Securities and Exchange Commission on Wednesday adopted new disclosure rules for hedge fund and private equity fund advisors aimed at increasing transparency, competition, and efficiency in the $25-trillion marketplace.
The rule-making updates Form PF, which was put in place following the financial crisis of 2008-2009 to monitor risks in the rapidly growing private fund sector, to boost the quality of confidential regulatory disclosures by large funds about their investment strategies and leverage. READ MORE
Private equity's looming bankruptcy boom
Private equity is facing a wave of portfolio company bankruptcies, due to rising interest rates and slowing economic growth.
What to know: The situation looks worse than it really is, at least in the short term. READ MORE
Why VC Specialization Is Good For Founders And Investors As Markets Mature
At one time, doctors were expected to have expertise in all aspects of the human body and treat every ailment. Nowadays, there is a specialist for every section of our anatomy. We can see a similar contrast in the professional expectations of athletes, then and now: Previously there was a one-size-fits-all conception of the athletic physique—strong, broad, long-limbed. As sports have diversified and victory in each arena relies on such small margins, competitors are determined to retain an edge and embrace diversification. READ MORE
Run, Unicorns, Run: April’s VC Funding Landscape In 3 Charts
Here’s how to earn a unicorn valuation in 2023 in one easy step. Ready?
Step 1: Already be a unicorn that’s raised bales of VC cash.
That’s what it seems to take to raise a big round these days. Of the 10 biggest venture rounds in April, four of the top five were raised by established unicorn companies that’d already raked in hundreds of millions in the past few years (or in the case of OpenAI, tens of billions in the past few months). READ MORE
In Favor Of VC-Backed Companies Building Profitably
Writ large, we still live in a "venture-first" startup culture. This means that most startups, most of the time, believe that they need to raise money from VCs and spend it in 12- to 18-month cycles in order to grow. The truth is, there’s another way: focusing on profitable, sustainable growth.
The good news is that this "venture-first" culture is shifting, given the current economic climate; this is especially true in healthcare, which saw a gluttony of funding in '21 and a pullback in '22. As happens in economic cycles, founders are shifting their mentalities and expectations. But the pendulum needs to continue to swing toward fiscal prudence and startup stability over a growth-at-all-costs mindset. READ MORE
Too many promising startups are floundering: Here’s how venture capital firms can help
If your doctor touted an 8% success rate for surgeries, you’d likely forgo an operation with them. Yet, these are exactly the numbers founders are faced with when securing funding for a startup. This is abysmal—especially considering that startups are the backbone of the economy and the enterprises of tomorrow.
Not only have startups been let down by the very people allegedly in place to support them—their investors—but those same shareholders have coerced them into the adoption of “best practice” strategies that are outdated and overly generalized. It’s not surprising that those practices have resulted in dramatically higher customer acquisition costs and more competition over time. READ MORE
Corporate VCs Take Bigger Role As Other Investors Pull Back
As overall startup investment declines, the share of funding done by corporate venture backers appears to be on the rise.
So far in 2023, several of the most active corporate investors are leading or co-leading a larger share of rounds compared to last year. They’re also leading a number of the year’s largest financings. READ MORE
Series D Hits Lowest Point In Years. What Does That Mean?
By the time a startup gets to Series D stage, backers are done asking questions about product-market fit and what inspires founders.
At this point, it’s all about scale. And while an IPO or acquisition might still be a few years away, executives better be able to present compelling options for big returns. READ MORE
4 Charts Show Startup M&A Deal-Making Is Not Moving In The Direction We Expected
Predictions were rife coming into 2023 that we would see a flood of M&A deals for venture-backed startups as funding and IPOs dried up and cash-strapped companies looked for a way out.
That hasn’t exactly happened.
In fact, startup M&A deal-making continues to dip, Crunchbase data shows. READ MORE
How Saudi money returned to Silicon Valley
It was in late March that Silicon Valley decided that it’s no longer shameful to accept massive investment dollars from Saudi Arabia.
“The more I think about it, the more Saudi almost feels like a startup,” Adam Neumann, the WeWork founder, told the audience of the Miami conference hosted by the kingdom.
Venture capitalists Ben Horowitz and Marc Andreessen were pumped up, too. READ MORE
25 Largest VC Backed Companies In The US in 2023
Venture capital-backed companies have played a vital role in driving innovation and economic growth both in the US and internationally. These businesses are frequently in their early phases and have great growth potential, but they lack the funds to expand. In return for an ownership part in the company, VC firms offer financing and expertise to support the expansion of these businesses. Top VC firms like Sequoia Capital, Andreessen Horowitz, GGV Capital, etc have played a great role in funding these companies. According to reports, the rate of job growth for VC-backed businesses is approximately 8 times greater than that of non-VC-backed businesses. READ MORE
These Ambitious Startup Founders Aren’t Raising Venture Capital Funding, At Least For Now—But They’re Still Growing Their Companies Rapidly.
Patrick Murray is founder of On Air Parking, a startup that brings in $9 million in annual revenue helping consumers find unsold airport parking for a discount, via an app similar to Hotwire. Murray partnered with a private investor in the parking lot industry to get the business off the ground and has hired a president to run the company and its team of about 10 contractors. However, he hasn’t opted to go the venture capital route. READ MORE
Why Startups May Soon Be Buying More Startups
If you’re a startup, it’s likely your exit won’t be going public or selling to a big-name acquirer. Instead, there’s a good chance you or your assets will end up in the hands of another startup.
Stats back up this presumption. Each year, in the U.S. alone, hundreds of funded startups get acquired by private, venture-backed companies. READ MORE
WeWork has frittered away $46.7 billion in value and venture capitalists haven't learned a thing
Last week, WeWork was forced to issue an embarrassing press release warning that it was in danger of being delisted from the NYSE because the stock has traded below $1 for so long.
In 2019, prior to a disastrous attempt to go public that resulted in the exodus of its flamboyant, controversial founder, Adam Neumann, WeWork was valued at $47 billion. As of Monday, with shares trading at $0.47 and a market cap of $345.7 million, the company has lost some $46.7 billion in value over four years — vanishing like a sand sculpture left in the wind. READ MORE
Private Equity Turns to NAV Loans as Liquidity Option
In times like these, when companies don’t have access to low interest rates and cheap debt, firms are getting more creative with injecting capital into their businesses. Here’s something new. READ MORE
Startup nation must grow up
After more than a decade of sustained growth, the venture capital community has experienced a rollercoaster for the last three years. During the pandemic we saw an extreme tide: a huge jump in the adoption of technologies, which was fueled by zero interest and quantitative easing. Towards the end of 2021, a series of threats washed over the economy: global inflation, rapid interest rate increases, the war in Ukraine, damage to supply chains, and a banking crisis. All of these led to a change in the tastes of investors, who shifted the focus from growth at any cost to efficient growth and profitability. The growth rate of companies slowed down, and there was a decrease in the value of public companies and the volume of funding rounds and transactions in the private market. READ MORE
A Founder's Perspective On Bootstrapping Over Raising Venture Capital
As an entrepreneur, one of the biggest decisions I have had to face when building capital is whether to raise venture capital or bootstrap. For many founders, the allure of raising VC seems obvious and offers many advantages.
I experienced this first-hand with my initial startup where I raised over $50 million in VC funding between 2012 and 2017. Prominent VCs from Silicon Valley, New York and Chicago became my equity partners and significant shareholders. This led to a "grow at all costs" mentality, where we tried various growth initiatives, developed multiple product lines and hired highly experienced executives. READ MORE
4 problems venture capital can’t solve
As the technology industry retrenches and venture capital firms tighten their standards, savvy founders should consider this counterintuitive question: Even if my vision is compelling enough to secure funding, should I take it?
Today’s marketplace is teeming with companies that simply grew too quickly, aided and abetted by their VC partners, and now find themselves managing the pain of down rounds, expense reductions, layoffs and a retreat from their boldest strategic gambles. READ MORE