There is no question that 2023 was a tough year for the venture and tech ecosystem.
Seed valuations have remained steady through 2022 and 2023, yet achieving the necessary traction for these rounds has become more challenging, which can create misaligned expectations for founders.
In 2020–2021, it was relatively common for $3 million to $5 million seed rounds to get done with very little, if any, traction, and they were typically getting done at $12 million to $25 million valuations, depending on the space and the founders’ background.
The bar is much higher to raise an institutional seed round, and a founder/company often needs to prove a lot more in today’s market than they used to.
This dynamic means that many founders have to first raise a pre-seed round to get to those milestones and therefore raise multiple rounds to get to a Series A.
Crypto valuations ‘came back to earth’ in 2023, but VCs expect them to rise again in 2024The past couple of years have proved to be a turbulent time for the crypto industry.
But a recent spike of interest in crypto, driven by rising Bitcoin and Ethereum prices, is rebuilding momentum, and many think that next year could be promising for crypto startups’ valuations.
Fundraising was difficult for both startups and venture capitalists in 2023, according to Lydia Chiu, VP of business development at Ava Labs.
In 2022, the crypto venture capital deck “saw a complete reshuffling,” with “many tourist VCs in retreat and their weaker portfolio investments bleeding out,” he added.
“Anyone should’ve expected venture funding to dry up in 2023, and it did,” said Will Nuelle, general partner at Galaxy Ventures.
Even though the economy is signaling a bit of a bounce-back, 2024 might not be much better than 2023 when it comes to startups sharing a piece of the budget pie.
If startups want a chance of making it through yet another bumpy year, they need to prove their worth now more than ever.
Investors told TechCrunch’s Ron Miller and Rebecca Szkutak that they’re still expecting some pockets of growth.
Get the TechCrunch+ Roundup newsletter in your inbox!
For example, 70% of respondents said they plan to hire next year and none are looking to downsize.
Despite a challenging economic period in 2022, this year’s investment into the space tech sector has continued to show signs of recovery.
Space tech has showcased a remarkable resilience amid macroeconomic uncertainty, bucking trends in the broader venture capital tech market.
Approximately $4.8 billion was invested into the space tech industry by the end of Q3, with growth-stage investment activity increasing.
These DoD contracts will stimulate a cascading effect throughout the broader space tech market.
This surge is expected to be catalyzed by strategic initiatives from respective governments, underscoring a global expansion and diversification of venture capital interest and commitment in the space tech sector.
TechCrunch Early Stage returns to Boston on April 25, 2024, and the agenda for our flagship founder event is shaping up.
For builders who are just starting on their founder journey, TechCrunch Early Stage is absolutely the place to be.
Submit your application to our call for content by the January 10 deadline, and you could win a roundtable slot at TechCrunch Early Stage.
TechCrunch Early Stage 2024 takes place in Boston on April 25.
Is your company interested in sponsoring or exhibiting at TechCrunch Early Stage 2024?
IT budgets should increase in 2024, but it still could be tough going for startupsI think most people would agree that 2023 was a challenging time to be a startup.
Meanwhile, sales cycles were longer and many startups struggled to grow at a decent pace.
This means that startups that aren’t well capitalized right now could continue to struggle in 2024, and the flipping of the calendar isn’t going to change that.
It means they have to fight for their piece of enterprise budgets, and that, possibly, 2024 could look a lot like 2023.
The budget outlookA good starting point for budget discussions is what the proposed budget looks like.
As 2023 comes to a close, a critical cohort of tech companies has regained the value it lost after the summer rally, potentially setting the stage for a stronger IPO cycle in early 2024 than some may anticipate.
Earlier this year, we saw three companies go public in quick succession: Arm, Instacart and Klaviyo‘s IPOs represented a liquidity peak, but they failed to inspire other tech companies to a rush towards the public market.
The three companies had pretty good IPOs, too, but they mostly failed to make the sort of splash some had hoped for.
Arm’s stock has performed well compared to its IPO price (trading at $71.30 per share today, up from its $51 list price), but Klaviyo and Instacart haven’t fared as well.
Klaivyo’s shares are trading 24 cents above its IPO price, while Instacart’s stock is trading at about $5 less than its listing price this morning.
The crypto winter may or may not thaw, but not everyone is going into the new year without hope: A majority of founders are optimistic about the opportunities for crypto startups in 2024, per a new survey shared exclusively with TechCrunch+.
The CoinFund Founder Forecast survey gathered responses from 30 of CoinFund’s web3 portfolio companies across the pre-seed, seed and Series A stages.
The survey ran from November 7 to November 17, when cryptocurrencies like bitcoin and ethereum were starting to show signs of price recovery.
While some crypto startups may be going out of business, Alex Felix, managing partner and chief investment officer at CoinFund, said these 30 companies have sufficient runway and are thinking about the new year.
According to the survey, the top areas primed for growth in the coming year include AI integrated with web3, zero-knowledge technology, decentralized finance, consumer apps, gaming, layer-2 blockchains and crypto wallets.
What is happening with all these new venture funds?
A growing number of venture firms may be uncorking champagne ahead of the New Year.
Today, a handful of investment firms announced new funds: Artis Ventures, BoxGroup, Playground Global and Singular all closed on funds, while Partech said it was launching a €360 million venture fund.
Steph Choo, a partner at the venture firm Portage, maintains that it’s still a “tough fundraising environment.” She thinks what we’re seeing is the result of continued interest in funds with strong track records and distributions to paid-in capital.
), which may drive renewed interest next year.”In the meantime, LPs may not be responding so much to what’s around the corner in 2024 but looking across the longer horizon, particularly given that venture funds typically invest across a 10-year period.
The 2024 Chevy Blazer EV RS first drive: A worthy but pricey all-electric SUV This roomy midsize SUV gets a lot right.
The Chevy Blazer EV will be offered in three trims: the LT, RS and performance SS.
The Chevy Blazer EV RS trim in all-wheel drive is already in production at GM’s factory in Ramos Arizpe, Mexico.
The press drive held in San Diego put reporters behind the wheel of the rear-wheel and all-wheel drive versions of the Chevy Blazer EV RS trim.
Those specs combined with a lower roofline and athletic stance give the Chevy Blazer EV a sleeker appearance than its gas-powered cousin.
