5 ms·

Bloomberg U.S. Startups Barometer

98 points by elsewhen 7y ago

lawrencevillain 7y ago
Hopefully the drop is from less people taking VC money.
- abrax3141 7y ago
  Why would that drop precipitously? It might vary a bit, but up up up then bang?
- zelly 7y ago
  That's hilarious.
roschdal 7y ago
The end is nigh.
- IGotThroughIt 7y ago
  The valley is not actually working. People are spending all their time being woke. Where will the innovation come from?
  - zelly 7y ago
    Those who remain after the crash
- scarejunba 7y ago
  What are you short?
  - deleted 7y ago
    [deleted]
- dang 7y ago
  Maybe so, but please don't post unsubstantive comments here.
paxys 7y ago
Someone please overlay that with a Bitcoin price chart
- kanwisher 7y ago
  perhaps thats what the over supply of startups was in 2018
  - nexuist 7y ago
    There were a ton of crypto startups around that time...haven’t seen any press from them since, with the exclusion of Coinbase, which seems to be doing well.
jedberg 7y ago
I'm pretty sure the market is turning. I'm seeing more stories on TC about companies shutting down than starting up. Rich people are starting to hold their cash in anticipation of a market dropout so they have reserves to buy up cheap assets.
- awb 7y ago
  There graph shows a market correction back to mid-2018 levels. I'm not sure what caused the dramatic boost in 2019, but that spike appears to be more of an anomaly than a trend.
  - oddity 7y ago
    Without knowing the causes, I wouldn't be confident concluding that it's simply a correction to 2018 levels. But yes, it's also not worth the panic just yet.
- blackrock 7y ago
  The black swan event has arrived But delayed is the feel Like a slowly approaching tsunami Distant is the crest Thinking it may stop Until the destruction becomes real.
  - zelly 7y ago
    What do you think is the black swan? 9/11 and Lehman were black swans. The business cycle turning over is not a black swan, especially with the majority of finance people predicting a recession this year.
    - paulgb 7y ago
      I wonder if we will come to consider Coronavirus a black swan? Despite the fact that it's dropped away from being the main headline in the US, the damage doesn't appear to be contained yet, and it will take time for all of the economic ripples to be felt. (I bring up economic effects because of the context, but I in no way mean to diminish the human suffering.)
oddity 7y ago
What events correspond to the recent peaks in the chart? It looks like the VC world was spooked around the start of December and nothing has changed its mind ever since. Given these are startups, I would expect much of the information to be private, but it seems highly unlikely this is a complete black box. Edit: The comments below raise good possibilities. My own (very naïve) research yielded that there was a sharp dip in the the overnight repurchase agreements at the start of December and a small rise a month later. I don't think this is the cause, and I'm probably biased by media narrative more than anything, but it might lead somewhere assuming there's a connection by way of the amount of easy money floating around. The EFF rate also dropped around 24th of July and hasn't gone back up [2]. [1] https://fred.stlouisfed.org/series/RPONTSYD https://fred.stlouisfed.org/series/RPONTSYD [2] https://fred.stlouisfed.org/series/DFF https://fred.stlouisfed.org/series/DFF
- zelly 7y ago
  - Coronavirus - Bernie Sanders rising in polls - Unicorn/IPO disappointment; WeWork, Uber, Slack - whales like MS, Google, Apple, Tesla outperforming startups by a ridiculous margin What little innovation happening is all coming from the big established corporations. We hit peak VC euphoria. You had kids with PhDs in EE/CS vying to become personal assistants for VCs. More people wanted to become VCs than start businesses and build things. Now it's time to clean house.
- ct520 7y ago
  The market started to rip in November. Easier returns elsewhere?
- paxys 7y ago
  The chart corresponds pretty well with all the high profile exits over the last year (most of them now trading lower than what the last few rounds valued them at).
- abbadadda 7y ago
  Also WeWork's very public IPO failure and SoftBank woes in general.
- 7y ago
sek 7y ago
Vision Fund 1 from Softbank is at the end of it's lifecycle, now they still try to raise for Vision Fund 2. You spend much more in the early phases of a fund, so it's big enough to make all the difference here.
wozniacki 7y ago
For what it's worth, Mike Bloomberg, a current candidate in the race for U.S. presidency and publisher of Bloomberg magazine, has been hoping that the economy nose-dives for atleast 3 years now.[1] It remains to be seen if his wish finally comes true. [1] Mike Bloomberg: ‘I Cannot for the Life of Me Understand Why the Market Keeps Going Up’ https://fortune.com/2017/09/20/bloomberg-infrastructure-jobs-tech-talent/ https://fortune.com/2017/09/20/bloomberg-infrastructure-jobs...
klik99 7y ago
# of deals and # of first financings seem to be in a normal dec-feb drop period, but I think the overall index is driven by insane amounts of money per deal that peaked in june last year, making it look like a scary situation if you look at the index alone. Taking the parts one-by-one this is looking quite healthy I wouldn't be surprised if the boom in deal amount was in turn driven by a small number of crazy large deals, assuming softbank, which given some big implosions last year has sobered up the amount given per deal. Again, this points to a healthier, more sustainable outlook since there are obvious longterm downsides to overinvesting in unicorns that can't possibly deliver.

98 points by elsewhen 7y ago

lawrencevillain 7y ago

Hopefully the drop is from less people taking VC money.

abrax3141 7y ago
Why would that drop precipitously? It might vary a bit, but up up up then bang?
zelly 7y ago
That's hilarious.

roschdal 7y ago

The end is nigh.

IGotThroughIt 7y ago
The valley is not actually working. People are spending all their time being woke. Where will the innovation come from?
- zelly 7y ago
  Those who remain after the crash
scarejunba 7y ago
What are you short?
- deleted 7y ago
  [deleted]
dang 7y ago
Maybe so, but please don't post unsubstantive comments here.

paxys 7y ago

Someone please overlay that with a Bitcoin price chart

kanwisher 7y ago
perhaps thats what the over supply of startups was in 2018
- nexuist 7y ago
  There were a ton of crypto startups around that time...haven’t seen any press from them since, with the exclusion of Coinbase, which seems to be doing well.

jedberg 7y ago

I'm pretty sure the market is turning. I'm seeing more stories on TC about companies shutting down than starting up. Rich people are starting to hold their cash in anticipation of a market dropout so they have reserves to buy up cheap assets.

awb 7y ago
There graph shows a market correction back to mid-2018 levels. I'm not sure what caused the dramatic boost in 2019, but that spike appears to be more of an anomaly than a trend.
- oddity 7y ago
  Without knowing the causes, I wouldn't be confident concluding that it's simply a correction to 2018 levels. But yes, it's also not worth the panic just yet.
blackrock 7y ago
The black swan event has arrived But delayed is the feel Like a slowly approaching tsunami Distant is the crest Thinking it may stop Until the destruction becomes real.
- zelly 7y ago
  What do you think is the black swan? 9/11 and Lehman were black swans. The business cycle turning over is not a black swan, especially with the majority of finance people predicting a recession this year.
  - paulgb 7y ago
    I wonder if we will come to consider Coronavirus a black swan? Despite the fact that it's dropped away from being the main headline in the US, the damage doesn't appear to be contained yet, and it will take time for all of the economic ripples to be felt. (I bring up economic effects because of the context, but I in no way mean to diminish the human suffering.)

oddity 7y ago

What events correspond to the recent peaks in the chart? It looks like the VC world was spooked around the start of December and nothing has changed its mind ever since. Given these are startups, I would expect much of the information to be private, but it seems highly unlikely this is a complete black box. Edit: The comments below raise good possibilities. My own (very naïve) research yielded that there was a sharp dip in the the overnight repurchase agreements at the start of December and a small rise a month later. I don't think this is the cause, and I'm probably biased by media narrative more than anything, but it might lead somewhere assuming there's a connection by way of the amount of easy money floating around. The EFF rate also dropped around 24th of July and hasn't gone back up [2]. [1] https://fred.stlouisfed.org/series/RPONTSYD https://fred.stlouisfed.org/series/RPONTSYD [2] https://fred.stlouisfed.org/series/DFF https://fred.stlouisfed.org/series/DFF

zelly 7y ago
- Coronavirus - Bernie Sanders rising in polls - Unicorn/IPO disappointment; WeWork, Uber, Slack - whales like MS, Google, Apple, Tesla outperforming startups by a ridiculous margin What little innovation happening is all coming from the big established corporations. We hit peak VC euphoria. You had kids with PhDs in EE/CS vying to become personal assistants for VCs. More people wanted to become VCs than start businesses and build things. Now it's time to clean house.
ct520 7y ago
The market started to rip in November. Easier returns elsewhere?
paxys 7y ago
The chart corresponds pretty well with all the high profile exits over the last year (most of them now trading lower than what the last few rounds valued them at).
abbadadda 7y ago
Also WeWork's very public IPO failure and SoftBank woes in general.
7y ago

sek 7y ago

Vision Fund 1 from Softbank is at the end of it's lifecycle, now they still try to raise for Vision Fund 2. You spend much more in the early phases of a fund, so it's big enough to make all the difference here.

wozniacki 7y ago

For what it's worth, Mike Bloomberg, a current candidate in the race for U.S. presidency and publisher of Bloomberg magazine, has been hoping that the economy nose-dives for atleast 3 years now.[1] It remains to be seen if his wish finally comes true. [1] Mike Bloomberg: ‘I Cannot for the Life of Me Understand Why the Market Keeps Going Up’ https://fortune.com/2017/09/20/bloomberg-infrastructure-jobs-tech-talent/ https://fortune.com/2017/09/20/bloomberg-infrastructure-jobs...

klik99 7y ago

# of deals and # of first financings seem to be in a normal dec-feb drop period, but I think the overall index is driven by insane amounts of money per deal that peaked in june last year, making it look like a scary situation if you look at the index alone. Taking the parts one-by-one this is looking quite healthy I wouldn't be surprised if the boom in deal amount was in turn driven by a small number of crazy large deals, assuming softbank, which given some big implosions last year has sobered up the amount given per deal. Again, this points to a healthier, more sustainable outlook since there are obvious longterm downsides to overinvesting in unicorns that can't possibly deliver.