The startup world could be in for a busy summer Today the economy is improving. Unemployment is falling, while interest rates are staying low. There's lots of new capital on offer, and some expectation that we'll get back to Q1's IPO wave in Q3. Throw in widespread vaccinations and a return to something akin to our old lives, and the world of business could be ready to accelerate further in short order. There are caveats, of course. Lots of folks are being left behind in the recovery. And vaccine hesitancy is as lethally stupid as it is surprisingly common. But anticipated summer economic conditions, strong markets and a general belief that the digital transformation's acceleration will continue point to a coming hot(ter) period for tech. That is good news for startups. We're already starting to see anticipatory reporting on the matter. Wired's recent piece on venture capitalists telling startups to invest rapidly is worth reading. I'll back it up by saying that it seems that most startups that I am chatting with every week had a solid-as-heck first quarter and aren't worried about the second. If I am not accidentally speaking with only founders who are doing well and somehow missing legion startups that are struggling, it seems to be a pretty darn good time to build a tech company. Plaid's round from earlier this week underscores what I'm talking about. The API-powered consumer fintech company's CEO Zach Perret told TechCrunch how much the digitization of the world of financial services had accelerated in the last year. Yep. Startups that would have done well in more normal times are often seeing their market move in their direction. Often rapidly. That's why Plaid is worth north of $13 billion today, nearly triple what it was worth in early 2020. For the startups doing well, there's ample cash on offer. Ramp's latest round, a two-in-one, makes that point plain. So, if the broader economy and its technological sector do accelerate, expect wallets to open even further. As the temperature heats up, so too could the business climate. I mean, how else can you explain the Clubhouse news? Or the Topps news? TechCrunch had to cover the middle ground between baseball cards, NFTs and candy, for the love of all that is holy. Next week The Exchange is digging into Q1 2021 venture capital numbers from around the world. We'll see soon enough how big the start to the year was, but we have a guess. |
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