The state of VC money
I haven’t written much about technical or industry related topics lately. I’ve just been so busy with work and life events that once I get to my blog, I just want to zone out and talk about life more. I’m hoping to start writing more about fintech, investing and startups when I get back to San Francisco next week.
One trend that I did want to dive into more detail was company valuations and the changing landscape of VC/angel money. Over the last year and half, we have seen record breaking VC/angel investment in startups. Valuations and amount of capital coming into the startups have increased significantly.
I suspect there’s 3 main reasons for this:
More demand in the market. There’s more money in the system than ever before due to government monetary policy. Investors are putting this money to work increasing the competition for investment. It’s never been easier to raise a micro-VC fund or become an angel investor.
Companies are growing larger at much faster rates. Improving tech has made building products and generating revenue easier than ever before. Startups are reaching levels much faster.
Accelerating trends due to COVID. If there’s one good thing coming out of the pandemic, it’s going to the innovation that stems from COVID accelerated trends. New industries have been born and trends that once were going to take years to take hold are now accelerated to now.
Each of these reasons likely warrants it’s own blog post so I’ll look to touch upon this trend more in future posts. For now, it’s back to catching up on emails from the day.