Crypto’s latest disruption may be investor expectations

2 years ago 142

Welcome to Startups Weekly, a fresh human-first take on this week’s startup news and trends. To get this in your inbox, subscribe here.

I’ve noticed that the long-awaited re-correction of private tech startup valuations and fundraising expectations has a web3-sized asterisk next to it.

While many funds are returning to more conservative check writing, with a focus on profitability and business fundamentals, crypto remains a sector in the spotlight that attracts dedicated billion-dollar funds and investment terms that remind us more of 2021 than 2022.

So, is it hype, the promise of innovation in crypto, or a little bit of both? Venture capitalists and founders across all fundraising stages spoke to current investment strategies when it comes to investing in this cohort of startups. The contrasting strategies come down to technical differences in cap tables, the culture of communities that many companies in this space are built upon, and, of course, the non-crypto world’s fear of missing out. As Freestyle’s Jenny Lefcourt tells me, “Web2 got the memo about valuations coming down, and web3 has not.”

For my full take on this topic, check out my latest TechCrunch+ column with our new crypto reporter Jacquelyn Melinek: Crypto is altering the investing landscape for even the most disciplined VCs.

In the rest of this newsletter, we’ll look at a digital fertility company, Fast’s shutdown and Better’s doom and our recent Austin City Spotlight. As always, you can support me by forwarding this newsletter to a friend, following me on Twitter or subscribing to my personal blog.

Deal of the week

Conceive is a digital fertility program taking a page out of CEO Lauren Berson’s professional and personal playbook. Years ago, the former Andreessen Horowitz partner left her investing gig to join Weight Watchers. Soon, she noticed that there was a “beautiful, palpable, continuous experience” of people supporting each other as they collectively go through a vulnerable time. In the meantime, she was struggling to have a child with her partner — a lonely few years full of questions, loss and confusion.

Here’s why it’s important: Conceive offers an eight-week “trying to conceive” program that pairs users with other families on similar journeys, whether it’s experiencing IVF for the first time, or the sixth. Cohort-based learning is then topped off with coaches and asynchronous curriculum.

What struck me the most is that this company will only succeed if it works: Berson explained she intentionally is starting with the direct-to-consumer route because she didn’t want to just serve folks who were “lucky enough to work with an employer who” offered fertility benefits.

Honorable mentions:

Image Credits: Futurestreet (opens in a new window) / Flickr (opens in a new window) under a CC BY 2.0 (opens in a new window) license.

One man’s Fast is another man’s Better

Well, we jinxed it: The fintech world was rocked this week with news that Fast, a speedy one-click checkout platform, is shutting down. The company cited slow growth, high burn and inability to raise more money as reasons for its demise. Affirm offered a vast majority of engineers job offers along with the shut down, but clarified they wanted the talent (not the technology).

Here’s why it’s important: As we talked about on Equity this week, failure can feel like a “Choose Your Own Adventure” in the world of startups. The important takeaway from the episode, which I urge you to listen to, is that there are often dozens of factors that play into a startup’s defeat. Theranos and WeWork play a role in understanding fraud at its height, but pivots and layoffs also give important signals into how founders respond to tension.

the re-correction is very much happening for private tech startups, here are some @techcrunch headlines *just* from this week – and it's only tuesday pic.twitter.com/VCbZS686pL

— natasha (@nmasc_) April 5, 2022

Failure is complex

Austin isn’t competing with Miami, relax

This week, TechCrunch traveled to Austin, Texas for our latest City Spotlight. But there was nothing nascent or basic that we unearthed. The city is a solid tech hub, full of unicorns, tech giants and absolutely no inferiority complex when it comes to comparisons of Silicon Valley. Heh.

Here’s why it’s important via Mary Ann Azevedo: “Austin wasn’t an overnight success. For years it was known primarily for its software scene — in addition to being the live music capital of the world. But today, new growing sectors include crypto/web3, real estate tech, CPG and insurance technology. As in other maturing markets, companies that have seen success in the past are now spawning a new generation of entrepreneurs as well as attracting others from various locales.”

Keeping it weird:

Across the week

So, are we hanging out next week? TechCrunch Early Stage 2022 is April 14, aka right around the corner, and it’s in San Francisco. Join us for a one-day founder summit featuring GV’s Terri Burns, Greylock’s Glen Evans and Felicis’ Aydin Sekut. The TC team has been fiending to get back in person, so don’t be surprised if panels are a little spicier than usual. Here’s the full agenda, and grab your launch tickets here.
Follow our new senior crypto reporter, Jacquelyn Melinek and our new senior enterprise reporter, Kyle Wiggers!
Finally, if you missed last week’s Startups Weekly, read it here: “What 411 YC Demo Day pitches will teach you about startups.”

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