The numbers have spoken • ClassyBuzz
Bridge rounds boomed on the finish of final yr
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Lux Capital associate Josh Wolfe predicted that “dry powder” would show to be “moist powder ” as enterprise capital funds choose to assist present portfolio corporations by means of tough occasions over making new investments. Information from Carta appears to substantiate that his hunch was proper: The frequency of bridge rounds boomed over the past quarter of 2022. — Anna
The requires assist may be coming from your personal portfolio
One month in the past, I warned that it could be a mistake to imagine that the document ranges of dry powder we saved listening to about would mechanically go to new startups. Whereas it’s true that VCs within the U.S. alone are sitting on billions in overhang, they may have to dedicate a big share of this capital to supporting ailing startups which might be already a part of their portfolio.
For this reason Lux Capital associate Josh Wolfe says that dry powder is definitely already moist. “All the cash raised at valuation peaks will get spent propping up ‘strolling useless’ zombie corporations that may’t elevate exterior cash and as an alternative have to show to insider rounds,” he mentioned.