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Startups have to show growth and/or revenue. They dump most of their funding into advertising. Many are spending more than the lifetime value of their customers
by jimhi 4y ago
Startups have to show growth and/or revenue. They dump most of their funding into advertising. Many are spending more than the lifetime value of their customers (if that can even be calculated at their stage at all).
Interest rates go up -> VC Money goes down -> Advertising budgets go down
Online advertising is "theoretically" better than other advertising. You can track exactly how it converts to sales or not. It is still the best way to advertise in my opinion so will beat out any other method for sure.
- r0m4n0 4y agoInterest rate increases are causing money to move around for sure. I’m just not convinced startups are the primary buyer of these online ads. Hell I would barely even consider them a drop in the bucket. Im sure basically every Fortune 500 and brick and mortar store have hefty online ad spends now a days. I suppose we will see soon enough
- jimhi 4y agoTrue - that's my guess anyway
- Macha 4y agoYeah, this isn't the dotcom era when internet ads was mainly startups buying ads on Yahoo thereby inflating their own value and Yahoo's value. The standard online advertisers are the standard advertisers these days (apart from a few smaller islands like podcasts or integrated sponsors on youtube), so it'd be a bigger recession to impact adtech, and the impact there is more likely to be in line with the impact to the rest of the economy than disproportionate popping.