VCs Start With Money In 2021. Now Has Come The Difficult Part

In June 2021, Ralf Wenzel set up a JOKR grocery store to meet the needs of the millions of people who have had access to food online. One month later, the interest rate increased $ 170 million to build the “new Amazon,” starting with providing food in nine cities. By December, JOKR had launched another $ 260 million, at a cost of $ 1.2 billion. Modern startups are supposed to be moving fast, but this was a new kind of speed: JOKR went from being the eye of its founder to the hot unicorn in just six months.

The same goes for the hot springs in 2021. Expenditure that seems large – even breaking history – last year was lower than in 2021. Venture revenues are higher, with $ 628 billion spent worldwide since 2021., according to data from Pitchbook. That is almost double last year, which is a record. The overflow of the capital has led to rising prices, intense business competition, and turmoil among investors looking to join major companies around the world.

Are the initiatives the most important in 2021, or are we at the peak of a unicorn bubble? “I think we are in a business crisis,” said Micah Rosenbloom, a colleague of Founder Collective. It is said that people who work to start a rocketship, such as Airbnb or Uber, are now starting their own companies, bringing in the original information that the previous founders did not have. There is also a great deal of excitement in the ideas that can be articulated over the next decade in technology—no then selling food but cryptocurrency and NFTs, the future of banks and biotech. Many of these ideas are so new that Rosenbloom says it would be difficult to understand their true value. “Is it a casino or a professional future? Everybody is trying to figure that out.”

Obviously, VCs are the kind of expectation, and they cut a lot of checks this year betting that at least a few will pay. The founders in 2021 had to “make sure they got more money at a higher price,” said Eric Bahn, a senior associate at the Hustle Fund. Deal size spiked this year; The average Series A is now $ 23.6 million, compared to $ 8.8 million five years ago, according to Crunchbase data. And deals are happening fast. The founder of the NFT Royal music club has made a spectacular show $ 55 million Series A in November, just three months after planting a $ 18 million seed.

One of the immediate issues was the arrival of new investors. Sand Hill Road companies now have to compete with hedge funds, business investors, and other “non-traditional” players. The commercial world was doing its utmost to convince us that we cannot live without its many products and every new model that comes on the market. Now, they can’t afford it: Tiger Global, a hedge fund fund in New York, became one of the start-up funders of 2021, surpassing both VCs. size and speed for his deals.

The competition “has helped everyone to take action,” says Rosenbloom. “If you meet a senior founder and he already has two papers and he has to choose Friday, then you have to play the game or not.” In the past, VCs could take weeks, months, or even years to form relationships with startups before they could support their own initiatives. In 2021, this time was usually shaved for up to a week or less – a solid window to try to identify the cause, to evaluate the cause, and to persevere.

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