Speaker 2
I'm i'm already hearing reports of that
Speaker 1
right and that's going to result in, uh, what you call hunkering down, where you basically have to say, cost control, slow things down. Now, that is a problem if you're a company that's five or six years away from actually having a commercial product, because it's still going to take a lot of money to commercialize your products. But if you're close to get ing to a commercial product, you know, maybe by hungering down, you you can get there.
Speaker 2
Well, you can't. It just depends what your burn rate is and how liberal you have been with the year spending. These sorts of environments all of a sudden prompt the boards of directors to bring edicts down on to the company management to cut costs and be much more mindful. And i think this is a healthy dynamic. I mean, we've seen this many times in other sectors of the economy, and now it's come to the text side of things. And and it just instills a greater respect for the capital and how it's spent, and spent more efficiently to achieve commercialization. And also puts the onus on the companies to drive towards commercialization faster, to get the pot get their products out in the robe. And so, you know, this is potentially a positive for these sorts of companies, is that, okay, we don't have as much money. We're going to have to be a little more frugal, and we have to get to market faster, which is for the benefit of getting these yeah, yeah, it's true. And money comes easy. You don't necessarily treat it
Speaker 1
as a finite commodity. I did want to say there was this wall street journal article last weekend which actually spoke, this was more focused on tack companies. But it basically was titled, silicon valley investors give startups survival advice for the down turn. And, uh, i basically set d that venture capital firms, so these are firms that are investing in some of these earlier stage companies, and usually these are private companies. It was telling that these companies need to cut their costs, preserve their cash and forget your hope that other investors will swoop in with big checks in the future. And in fact, one of them, and this is coming from sequoia, one of the silicon val these pretty well known firms, apparently their power point got leaked and it was quoted in this article. But it basically said, we don't believe this is going to be another steep correction followed by a v shaped recovery, like we saw after the pandemic. They advise companies to cut expenses quickly and expect it's going to be a long recovery. The going to have access to capital for a while.
Speaker 2
Yeah. I mean, i think if we use history as an example, certainly, when we saw this movie before, 20 years ago, it took five to ten years for the money to come back. And the excitement to come back. Now, that's not a blank statement. And i think that takes us to our next point, which is, uh, what i call darwinism, you know, survival of the fittest. What good companies will still survive through this? Good companies with management that knows how to be more efficient, lean and mean, so to speak, and and take it through, and they've got a quality product that's driving towards commercial ization, they will still be able to raise money. And so it's just that the market is going to be a lot more selective. And i think that's a healthy thing too.