This Week in Startups

Series A valuations, M&A in 2024, and M.A.N.G with Jason Shuman and Raja Doddala | E1883

Jan 20, 2024

Jason Shuman and Raja Doddala join the host to discuss startup valuations in 2024, caution for new shareholders, and benefits for existing shareholders. They talk about the changing definitions of funding rounds, importance of product-market fit, challenges faced by startups, and the rise of strategic investing by tech giants. They also touch on the shift to Series A funding, managing liquidity in venture capital, and investor roles and decision making.

01:02:24

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Episode guests

Raja Doddala

Jason Shuman

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Episode notes

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Quick takeaways

Series A valuations are increasing, driven by moonshot companies and AI boom.

Strategic investments from tech giants can distort average valuations and create conflicts for founders.

Venture capitalists adopt different strategies for managing liquidity and achieving returns.

Deep dives

Series A Valuations on the Rise

Series A valuations have seen an increase, with the median valuation rising from $38.8 million in Q3 2023 to $45.5 million in Q4. Moonshot companies and seed infrastructure deals driven by the AI boom are commanding higher valuations, while predictable growth companies are going for 8 to 12x NTM. However, investors may face challenges making returns investing in companies without product-market fit at high valuations.

Introduction

2min

Shifting Definitions and Valuations in Startup Funding Rounds

9min

Venture Capital Investments and the Importance of Product-Market Fit

3min

Demand and Supply of Funding at Different Stages of Startup Development

8min

Late-stage Rounds, Distortion, and the Importance of a Business Phone Number

2min

The Rise of Meng: Strategic Investing by Tech Giants

9min

AI Enclave, Startups' Challenges, and Investment Strategy

2min

The Shift to Series A and Challenges for LPs

2min

The Rise of Secondary Funds and Managing Liquidity in Venture Capital

18min

10.

Investor Roles and Decision Making

8min

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Today’s show:

David Weisburd hosts Jason Shuman, Raja Doddala, and Jason Calacanis to dive into 2024 startup valuation trends (2:00), insights on how VCs can secure great deals in a competitive market (17:46), a detailed look at secondary deals (36:25), and more!

Timestamps:

(0:00) David Weisburd hosts Jason Shuman, Raja Doddala Jason Calacanis to dive into the world of VCs, LPs and GPs.

(2:00) A look at the encouraging trends in startup valuations as we head into 2024.

(6:39) Delving into the intricacies of current valuation methods and key aspects investors should be cautious about.

(11:22) Paintbrush - Visit http://www.getpaintbrush.com to see if you qualify for a $50K startup loan in less than 2 minutes

(13:42) Examining the balance of demand and supply in the seed funding stage of new startups.

(17:46) Insights on how venture capitalists can secure the most sought-after deals in today's competitive market.

(22:00) OpenPhone - Get 20% off your first six months at https://www.openphone.com/twist

(23:29) Discussion about M.A.N.G., a rising player in the venture capital scene.(28:26) Exploring the unique and often controversial practice of round-tripping in the venture capital industry.

(33:03) Lemon.io - Get 15% off your first 4 weeks of developer time at https://www.Lemon.io/twist

(36:25) A detailed look at Lexington's successful raising of $22.7 million in secondary investments.

(57:24) Observing the recent increase in mergers and acquisitions activity within the industry.

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Check out David’s other podcast here: https://www.youtube.com/channel/UCncFI0XEvTu7k4er6BgVN9g

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(33:03) Lemon.io - Get 15% off your first 4 weeks of developer time at https://www.Lemon.io/twist

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