@micshasan

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@micshasan1 year ago
Realness from Tom here. Just want to see more explaining the rationale for this piece: 'The hangover will start later this year and will be more severe than that from the GFC.' That's a big statement, and it might be true ... would like to understand the evidence.

Startup companies

@tomloverro
PREDICTION: There's a mass extinction event com...
PREDICTION: There's a mass extinction event coming for early & mid-stage companies. Late '23 & '24 will make the '08 financial crisis look quaint for startups. Below I explain when, why & how it will start & offer *detailed advice to founders* on surviving the looming die-off. /1
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Many startups raised ~2 years of cash in 2021 and 2022. They cut burn in H2 2022 to extend that 🛫. But no matter what, they’ll need to raise again (or sell, or become a 🧟) in late 2023 and 2024. /3
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This time is different. 2021, for startups, was more toxic than the GFC. The hangover will start later this year and will be more severe than that from the GFC. /7
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To survive, here’s 7 steps early-stage founders should take: /14
1. Raise 💰now or sooner than you expected, before the Great Flood 🌊of 2023. If you fail, you can always try again later. But if you wait, try later & fail, well… /15
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5. Trade better unit economics for growth. Growth rates are coming way down for everyone this year. It’s all relative when you’re raising money. If you can nail your unit economics, you can always ramp burn and growth later. /19
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7. Be decisive. Half-measures rarely succeed. /END
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