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Silicon Valley’s Unbridled Euphoria Runs Into Economic Reality


From July to September, startups around the world raised $81 billion, down 53% year-over-year, according to Crunchbase. This is the biggest drop since the site began tracking funding in 2007. More than 700 startups have laid off 93,000 workers this year, according to Layoffs.fyi, which tracks job cuts work in startups. In the past two weeks, Weaker quarterly results at big tech companiesincluding Snap, Meta, Amazon and Microsoft, sent the broader tech industry down a spiral.

Techies are optimists by nature. And some companies, including those that focus on artificial intelligence and climate technology, tried to create in an exaggerated way. But at TechCrunch Disrupt, a large-scale startup conference in downtown San Francisco this month, speakers urged founders and tech workers to accept the reality.

“The next few years will be a lot more difficult and there will be fewer resources,” said Sheel Mohnot, an investor at Better Tomorrow Ventures.

“You can’t keep doing what you did last year and expect the same results,” said Vieje Piauwasdy, director at equity plan provider Secfi. “The market has changed. Everything has changed completely.”

Thejo Kote, founder of Airbase, a financial software provider, said many startups are “moderately overvalued, overvalued, or you’re in La-La Land and you haven’t realize that.”

In one panel, investors assured founders that it was possible to lower their ambitions from building a $100 billion company to an $8 billion company.

Kara Nortman, an investor at Upfront Ventures, concludes: “Now we’re going back to fundamentals, which, in my opinion, are good for everyone.

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