Big Technology Podcast Which Startups (And VCs) Survive a Bear Market — With Nina Achadjian
Jun 15, 2022
Nina Achadjian, a partner at Index Ventures, shares her insights on the impact of declining market valuations on startups and venture capital strategies. She explains how the current bear market is reshaping funding dynamics, emphasizing a shift towards profitability over growth. Achadjian discusses how emerging fields like AI present opportunities amidst challenges, and highlights the potential of vertical software tailored for niche industries. The conversation wraps up with a look at e-commerce and crypto's future in this new economic landscape.
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Inflated Valuations
- Cheap capital and high valuations led to compressed fundraising rounds and inflated startup valuations.
- This created a disconnect between valuation and traction, causing a market correction.
High Valuations and Their Consequences
- Founders accepted high valuations despite increased pressure from VCs and the market.
- This was driven by concerns about dilution and competition, but it impacted employee option value.
Market Correction Impact on Hiring
- The shift from "growth at all costs" to profitability is causing hiring freezes and layoffs.
- Executives may leave startups for more stable companies, seeking better prospects.