Hey guys, Patrick Boyle bringing us another sign of the time..
🕑 Added 2024-01-23 16:57:44 +0000 UTC
Hey guys, Patrick Boyle bringing us another sign of the times- startups are not the hot speculative commodity any more. No affiliation to Patrick whatsoever, but his channel is quite something. if you have time to listen to the video, enjoy. Otherwise, here are a few key points to consider :)
Startup Failures: More than 3,000 private venture-backed startups shut down in the past year, marking a significant downturn. Notable closures include Hyperloop One, Bird, Smile Direct Club, Olive AI, Zume, and WeWork.
VC Landscape: Of startups raising money, 19% received funding at a lower valuation than in previous rounds, and 38% of venture capitalists disappeared from dealmaking. The SoftBank Vision Fund alone lost $53 billion over the last two years on startup investments.
Job Losses and Layoffs: Over a quarter of a million workers at tech companies were laid off in the same period. Olive AI laid off staff citing tough economic conditions in 2022, and WeWork, valued at $47 billion at its peak, filed for bankruptcy in November.
Financial Impact: The startups that failed received approximately $27.2 billion in venture capital funding, with notable losses such as Hopin, once valued at $7.6 billion, recently selling its main business for just $15 million.
Reasons for Failures: The startup failures coincide with a shift in investor sentiment as interest rates rose. Many startups, particularly those with untested business models like gig economy businesses and robot-made pizza, struggled to achieve profitability, leading to the mass extinction event described in the press.
https://youtu.be/-V9yPGdubHQ?si=B6WUSj_Ynqwi88j5
