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Your startup is gaining momentum and you’re ready to raise capital to scale.
Great, but from whom?
Not all capital is created equal and choosing the right investment partner could be critical to your next phase of growth. Chances are you’ve started to compile a list of well-known VCs to target, but how do you evaluate the investors to determine who would be the best fit? READ MORE
The third quarter's average U.S. venture capital exit value was $166 million, according to data from PitchBook and the National Venture Capital Association. It has been less than $100 million for six straight quarters and was $26 million in the second quarter. A year ago, it was $55 million. Looking back to 2012, average exit values peaked in the second quarter of 2021 at $559 million. READ MORE
Linus Liang loves working with founders to build companies from the ground up. After eight years at venture capital firm Signia, Liang set out on his own this year, co-founding Kyber Knight Capital, a San Francisco-based firm that invests in early-stage tech companies, particularly those in artificial intelligence, e-commerce, and media. Kyber Knight's inaugural $120 million fund launched in June, with limited partners including former eBay and HP CEO Meg Whitman and former Walt Disney chairman and CEO Michael Eisner.
With his new fund, Liang's investment strategy has radically shifted in response to the boom in artificial intelligence startups, which he calls "the most exciting opportunity we've seen in a decade." READ MORE
Autumn on planet Earth didn’t start until the equinox a few weeks ago, but the axis shifted months ago in Startupworld, where VC winter has desperate founders smashing up the furniture for firewood.
Metaphorically speaking, of course.
We’re definitely in a down market, but for entrepreneurs who are eager to build and scale, venture capital is always scarce. READ MORE
Sam Bankman-Fried’s trial kicked off this week in a Manhattan federal courthouse. The disgraced crypto wunderkind faces seven counts involving fraud and conspiracy charges related to the implosion of crypto exchange FTX.
The spectacularly colossal nature of SBF’s downfall has impacted not only the crypto startups and venture funding in the sector, but also venture capital in general. READ MORE
As I venture deeper into the VC landscape, I'm struck by the overwhelming prominence of "reactive, short-term investments." This approach does more than just pump up valuations—it sends ripples through startups and the broader venture ecosystem while challenging the very foundation of Silicon Valley's historic allure. READ MORE
To say it has been a tough time to be a startup founder over the past two years is an understatement. We all know that venture capital funding has been down, valuations are down, interest rates are up, and the predicted merger boom has yet to materialize (although deals are still happening). Throughout the summer, there were many news stories about a purported wave of startup shutdowns that have resulted from the economic rollercoaster we have been on, warning those numbers could increase as we move into late 2023. READ MORE
MRL stands for management rights letter. U.S.-based venture capital investors will often ask for an MRL as a condition to closing a financing. Founders will often ask us, “what is an MRL?” and “why does this investor need one?” READ MORE
The venture capital market in the U.S. has another quarter of declines.
The number of venture deals in the three months ending Sept. 30 dropped 24%, to 2,715, compared with the prior quarter, according to data from PitchBook-NVCA Venture Monitor First Look. Total funding declined 12% to $32.7 billion. READ MORE
Global venture funding in the third quarter of 2023 reached $73 billion — up a bit quarter over quarter and down 15% from the $86 billion invested in Q3 2022, Crunchbase data shows.
Despite the uptick quarter over quarter, this is the second lowest quarter since funding started to slide in 2022. The startup world is now five to six quarters into the current funding decline, Crunchbase data shows. READ MORE
Cybersecurity risks are omnipresent. September’s hack of MGM Resorts International and Caesars Entertainment showed just how vulnerable companies can be, no matter how large or small.
Institutional asset owners and asset managers, and private equity firms especially, are uniquely positioned to be victims of cyberattacks, with “treasure troves of sensitive information,” as one technology manager put it, there for the taking. Any cybersecurity incident can have drastic consequences for the firms, their portfolio companies and their sensitive information. READ MORE
U.S. venture capital exit values appear to have staged a bit of a comeback in the third quarter, while fundraising and total transaction values faltered, PitchBook-National Venture Capital Association's U.S. Venture Monitor showed.
There was a total of $35.8 billion worth of exits in the third quarter, up from a combined $6.6 billion in the second quarter and an increase from $16.4 billion in the third quarter of 2022. However, there were fewer exit transactions in the third quarter (216) than in the second quarter (256) and the year-earlier quarter (298). READ MORE
The global venture capital market is in a slump.
There was some hope that the potential halo effect of several long-awaited tech IPOs in the United States trading well and slowing interest rate hikes could spur VCs to be freer with their checks, but venture investment trends instead dipped, per preliminary data from PitchBook. READ MORE
The current economic climate has been challenging for privately held companies seeking to raise growth capital. Several factors have contributed to the recent contraction in fundraising, including high interest rates, reduced access to capital, a decline in valuation multiples, and an unfavorable outlook for exits.
Given this market environment, companies seeking to attract new capital have increasingly had to conduct down rounds, equity financings at lower company valuations than in prior rounds. Our Goodwin Deal Database indicates the percentage of down rounds has risen steadily for six quarters. READ MORE
Is a recession coming? While some sources predict that a recession is on the horizon and others say signs point to “no,” what we know for sure is that businesses are adapting to bear the brunt of economic changes, real or imagined. Businesses are feeling the effects of fear, even while inflation is dropping and the stock market is rising.
Despite some healthy economic indicators, venture capitalists are still wary about allocating funds, because there is no telling what the future holds. With fewer VCs providing funding, fewer startups will be able to take their first mass-market breath. READ MORE
A nice pair of sneakers, Brunello Cucinelli vest, an expensive car and a cry for help in their eyes — that's how I'd describe a typical venture capitalist on their path to becoming a partner one day.
In public, we position ourselves as superheroes supporting world-changing startups. In reality, it's a male-dominated, materialistic culture marked by burnout and cynicism.
We have only ourselves to blame for the misery we suffer and spread. We are sinners, and here are our gravest sins. READ MORE
Helping an investor cash out of a gummed-up buyout fund used to be a niche business. Now it’s mainstream. So-called secondary funds, which offer to buy unwanted private equity holdings, have become widely accepted. It would be a shame if normalization overshadowed one of the key reasons they have flourished — to remedy seemingly ill-disciplined investment in private markets during the era of easy money. READ MORE
After about half a decade of registering double-digit percentage returns in nearly every quarter, venture capital's performance has reversed dramatically.
US-based venture capital funds' IRR fell to -16.8% in Q4 2022, according to PitchBook's latest Quantitative Perspectives report. That's the worst quarterly return the asset class posted in 10 years. READ MORE
As the summer winds down, American venture capital is enjoying a new spring.
Though venture investment remains depressed compared to recent heights, green shoots are emerging quickly for those paying attention. Good deals are back. And from inside the world of venture capital, a pervasive, privately acknowledged sense of “investment thesis” disarray among experienced investors is a counterintuitive signal of an impending massive startup dawn. READ MORE
Recently, I was reading Crunchbase News’ analysis of the declining volume of M&A deals involving VC-backed companies, which are still technically referred to as startups.
This led me to ask myself: When we talk about startups, what do we really mean? Is a startup still a startup after it has acquired enough capital to buy another company for hundreds of millions of dollars? READ MORE
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