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Market dissonance doesn’t always cover the easy way – TechCrunch


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At this point, it’s clear that no one agrees on anything. Half of my sources say the early-stage venture has absolutely nothing to do with the public stock market, while the other half says everyone is pivoting to profit to expand the runway. – whatever the stage. And while discord is an evergreen story to cover, it’s also confusing.

For example, how to have more VC dry powder than ever, but also the slowdown in investments? How is it possible? fintech still gets one out of five dollars in venture finance, but still the sector that has suffered the most layoffs in the recent wave? How can LPs rethink their venture capital positions, but is this also an optimistic time for emerging fund managers to finally come out? How Stripe’s Adjusted Valuation Could Be Upbeat news for a company ahead of the curvewhile also the decline in its value amid the public market downturn of fintech?

These are all rhetorical questions, so to quote my favorite podcast, don’t DM me. I point out these imbalances not to complain but to hopefully offer some validation of how you are feeling these days. So many things can happen at once, which makes absolute statements useless for startup theory and market understanding.

In a way, it’s the season of the air. Last week, I sat down at a meeting of an emerging fund manager and was struck by the optimism in the room. Investors aren’t as obsessed with the market’s impact on venture funding as I am; they were tense about LP, sure, but also more focused on expanding their definition of what an LP could be. And just like that, the story I’m working on about a difficult environment for emerging fund managers takes on a different tone.

My best advice on navigating a moment of change? Keep reading, ask questions about your sources, and don’t feel the need to jump right into the Big Tech News of the Week.

In the rest of this newsletter, we’ll learn about an innovative twist on limit board management, the impact of Roe’s reversal on technology, and cauldron. As always, you can support me by forwarding this newsletter to a friend or follow me on twitter or sign up my blog.

Trading of the week

Continuum is a bet backed by a shard joband better yet, the founders wanted to show humanity in times of crisis. The company, launched by CEO Nolan Church in August 2020, started as a playbook to connect startups with part-time executive help. Now, it’s been expanded to help struggling tech companies cut staff in a more humane and thoughtful way.

Here’s why it’s important: Continuum’s new layoff tool connects startup leadership teams with an HR executive who will help build the company’s communications plan, analyze diversity and impact, and provide day-to-day support.

Continuum’s broader goals also revolve around early-stage startups becoming more comfortable with the idea of ​​part-time executives. Church thinks the recession will accelerate the trend of startups relying more heavily on contractors, consultants, advisors and angel investors to become contributors to a company. Part-time employees help reduce risk, fill key gaps in critical times, and cost less to fill when a company is trying to focus on sustainable growth.

An analog clock and a ball of American paper money balance each other on a seesaw

Image credits: Pictures of PM (Opens in a new window) / Beautiful pictures

Stripe’s internal valuation slashed

Stripe is the latest high-profile fintech company to make a major valuation cut as the market downturn begins to hit the sector particularly hard. Last valued at $95 billion, the payment processor slashed the internal value of its stock by 28%, sources told the Wall Street Journal. The magazine also reports that the cuts come from the 409A process, which companies do on a regular basis, or when the market can even lower its value.

In this case, the key event is the stock market downturn.

Here’s why it’s important: Outside of the fintech space, businesses in the explosive growth phase of the pandemic have turned inward in response to the changing macroeconomic environment. In March, Instacart also cut its internal valuation by about 38.5% due to the 409A change. Both Instacart and now Stripe’s reported internal valuation cuts mean employees could have their equity benefits readjusted.

Image credits: GeorgePeters / DigitalVision

Insert “Pitch Perfect” joke here

First of all, TechCrunch Live is a brand new platform and we’ve made it even easier to sign up for Pitch Practice. Investors (and my inbox) can attest to the importance of brevity, tact, and clarity in pitches, so it’s great to see that.

Startups can now apply any day, any time to Ultimate Practice by complete this form. We will select startups 24 hours before that week’s event and notify startups via email. And if you’re selected for an event, you can also sign up for future events. We want companies to present more than once using feedback provided from previous experiences. Call it inexpensive growth.

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Until next time,

WOMEN





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