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There is a clash happening at an early stage of the market.
In one realm, late-stage investors react to technology corrections by demanding the early-stage investing realm, forcing core investors to go early to defend ownership and potential returns. This trend was underlined by companies like Andreessen Horowitz, which launched a seed program months after launching a $400 million seed fund. Even more, Techstars, an accelerator literally launched to help startups take off, first launched a fund to support companies that were too early for their traditional programming.
While all of this is happening, early stage investors continue to hold out Rating correction and wide write-offs for the portfolio. Some admit they are telling portfolio companies to refocus on cash preservation, profitability, and discipline, not just growth.
Suppose these two vastly different worlds are in the same universe: early stage investors are getting more disciplined and cash-rich, but at the same time early stage investors are going early. Institutional investors pay to be skinny but also green, but at the same time, they are offered $10,000 to take a PTO for a week and try their hand at entrepreneurship. Growth, Gross Margin and Burn are the new top priorities for CEOsbut at the same time, venture capitalists are calling for more funds to be put forward, earlier, in newly innovative subcategories of early-stage investing.
It happens so much at once, it makes me worry about the race to the bottom – or the race to the first stage – and its consequences. For more ideas, read my article at TechCrunch+: “If early adopters keep going, what will happen?”
In this newsletter, we will talk about news related to Elon Musk and news that has nothing to do with Elon Musk. As always, you can support me by forwarding this newsletter to a friend, Follow me on Twitter Or subscribe to my personal blog.
Let’s talk about Elon Musk
As I’m sure many of you already know, Elon Musk’s $44 billion bid for Twitter was accepted this week, marking a massive moment in tech history and an imminent return to the private markets of a basic social media platform. We’ve written the full timeline of Musk’s acquisition, from tweets to closing, but just know that the saga isn’t complete yet — the deal isn’t officially over yet.
Here’s why it’s important: I mean, this one-time format doesn’t work because there are a lot of angles as to why Musk’s purchase of Twitter is so important. Instead, I’m just going to list some specific angles that TechCrunch has dug up.
Finally, I’ll remind you all that Twitter, in its earnings this week, said it has outnumbered its users over the past three years. With 1.9 million accounts. Jeez. It’s a bad look for Twitter, but it’s also bad news for advertisers – a source of income on which the platform relies heavily. Like Sarah Perez In other words, “For a company that relies on ad revenue right now like Twitter, it’s amazing that they would agree to a deal that absolutely puts freedom of speech.”
Well, now let’s not talk about Elon Musk for the rest of the newsletter
Yes, we are at this stage of [insert high–profile news cycle] story. First, there are leaks and scoops. Then there’s the little enclosed thought pieces. Then there is the main emphasis. Next, there are the wild, stoic editorial topics and articles sprinkled with more leaks, more scoops and essential details. And finally the stories that want to provide a short respite from the aforementioned madness. Let’s embrace this last stage!
The deal of the week, which may have slipped under your radar, is that Robinhood is laying off 9% of full-time employees.
Here’s why it’s important: Robinhood announced the layoffs just days before its first-quarter 2022 earnings, and after seeing its value erode in public markets. This appears to be a defensive move and the company’s attempt to prove that it is on its way to becoming a more efficient and growth-oriented financial institution. Also in fintech news, PayPal is closing its San Francisco office.
Things get tense.
all the week
Seen on TechCrunch
How Lydia wants to make payments more personal and social
Does it smell like teenage spirit or teen bankruptcy?
Airbnb is fully committed to remote work: ‘Live and work anywhere’
Midas touches AppDynamics founder again as Harness valuation reaches $3.7 billion
Snap announced a small drone called Pixy
Viewed on TechCrunch +
How to get to the Y Combinator, according to Dalton Caldwell of YC
Please do not use your 401(k) for shitcoins
Having some cryptocurrency in your 401(k) is neither irrational nor prolific
Why Latin America Shipping Opportunity Still Attracts Capital
At a cost of billions of dollars, meet the 9 startups developing tomorrow’s batteries today
until next time,