5harathFounding Growth Lead, Willow Voice

Fundraising Environment 2023 - Zehra Naqvi, Undefeated Underdogs #shorts

26 Sept 2023 · 1 min

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1:02

In this short interview, the speakers discuss the dramatic shift in the venture capital (VC) ecosystem following the 2020‑2021 funding boom. They note that the boom created an old‑school mentality that prioritized VC fundraising above all other capital sources. With worsening macro‑economic conditions, VC firms are now writing far fewer checks, making it hard for founders to identify active angel investors. Founders express frustration when they engage with VCs who are not actually investing, feeling that time is wasted and that opting out of VC is perceived as settling for a second‑best option.

Chapters

Like, I'm assuming, I'm assuming like you get more deals like in 2020, 2021, but now that there is like a dip, right? How are you handling internally? You know, if you want to share, what's the situation like?
Yeah, I think it's a really interesting question because you're exactly right. Like 2020 and 2021 in the whole VC ecosystem was just this huge boom. I think the old school VC mentality that like, again, VC fundraising is the best and everything else just comes second. That's something that we've had to grapple with. And I think it's interesting because as you referenced, the macroeconomic conditions are kind of worsening. VCs are not writing as many checks. It's really hard to figure out who is an active angel investor. And I've had conversations with lots of founders who get frustrated because they have a conversation with a VC and it's clear they're not writing checks. So it almost just becomes like wasted time. And I feel like there's this connotation that founders are afraid of where if they don't do VC, then it's like everything else is second best.