2022 stock options report, pivot to SaaS, crypto investor survey • TechCrunch

We spend a lot of time praising tech investors and entrepreneurs for their risk appetite. But why don’t we put startup workers on the same pedestal?

Who’s taking on more risk: A Stanford grad who leveraged their network to raise a seed round or an immigrant worker who relocates to an expensive city for a startup job?

In its latest yearly report, Secfi, which helps workers manage equity, found that 24% of the companies on its platform reduced their valuations last year.

“For people working at those startups, that means some (in some cases, all) of their employee stock options spent 2022 underwater,” writes Secfi CEO Frederik Mijnhardt.

Considering how central equity is to attracting tech talent, “underwater stock options have the potential to negatively impact hiring and retention across the startup ecosystem,” he writes.

Investors won’t stop pushing for down rounds anytime soon and more layoffs are coming. Here’s some candid advice for late-stage startup workers:

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Hoping for the best is not a strategy, and your employers will say whatever they need to keep you focused and productive. If or when you get laid off, there’s a chance that a TechCrunch reporter will find out before you do.

If you’ve been nurturing an idea for a company, put together a pitch deck and start reaching out now to investors. They will be more receptive than you think.

That’s no hot take.

Yesterday, Monique Woodard tweeted that she’s launched Cake Ventures Fund I, “a $17M seed and pre-seed fund.” Similarly, Axios reports that Social Capital is shifting the focus of its new fund to early-stage deals.

Expect other VC firms to follow suit; despite the maverick myth of the tech investor, herd mentality dominates.

Raising enough funds to build your MVP and strive for product-market fit might sound risky, but is it any more precarious than working at a late-stage startup in Q1 2023?

Thanks for reading,

Walter Thompson
Editorial Manager, TechCrunch+
@yourprotagonist

You’re not going to grow into your 2021 valuation

Many, if not most, founders who are attached to their 2021 valuations are living in a fantasy, according to Jeremy Abelson and Jacob Sonnenberg of Irving Investors.

For this TC+ post, they worked out “the simple math behind how long it will take companies to price their IPO at a flat round to their previous 2021 valuations.”

Companies with 75% YoY growth “can entertain the discussion,” but “if you are growing sub-30%, there is a strong chance that growing into your 2021 valuation is impossible.”

Why Africa had no unicorns last year despite record fundraising haul

Unicorns are becoming an endangered species in Africa’s startup ecosystem, reports Tage Kene-Okafor.

Although funding in the region increased slightly in 2022, “no unicorns popped up throughout the year, compared to five in 2021,” he writes.

“So what happened in Africa in 2022 that made it so … weird?”

Predictions for the longevity industry in 2023

A silver tsunami is approaching.

“By 2030, the 50-plus market is projected to swell to 132 million people, who are projected to spend an average of $108 billion every year on tech products,” according to Abby Miller Levy, managing partner and founding president of Primetime Partners.

Services like telemedicine and preventative care are just two aspects of the market: Longevity tech also encompasses retirement planning and other services targeted at older adults.

“We see incredible founder momentum, untapped areas to build new businesses and a window to an increasingly tech-accessible, rapidly growing consumer market.”

Some investors are (cautiously) implementing ChatGPT in their workflows

Can AI turn out polite pitch rejection letters, automate aspects of due diligence or draft accurate market maps?

Some investors are already evaluating ways to fold ChatGPT “into their workflows to do their jobs better, smarter and maybe even cheaper,” report Natasha Mascarenhas, Christine Hall and Kyle Wiggers.

They interviewed several VCs to learn more about potential use cases, some early experiments and the tech’s limitations when it comes to nuance and tone.

“It’s not automating the important conversations we have with journalists,” said Brianne Kimmel, founder of Worklife Ventures, “but I think it’s sufficient for things that are pretty straightforward.”

How we pivoted our deep tech startup to become a SaaS company

Soon after launching iOS location app Burbn, its developers realized that users were mostly interested in its photo-sharing features.

After making a data-driven pivot, they retooled and rebranded their app, which we now know as Instagram.

ECM PCB Stator Technology was formed to build next-generation electric motors, but after studying the market more closely, CEO Brian Casey determined that a SaaS model offered clear advantages.

“The market forces, customer needs and opportunities that existed for your venture at first raise and launch will almost certainly change down the road,” says Casey.

6 crypto investors talk about DeFi and the road ahead for adoption in 2023

Jacquelyn Melinek surveyed several crypto investors to learn more about what they’re looking for and how they’re advising their portfolio companies in Q1 2023:

• Michael Anderson, co-founder, Framework Ventures
• Alex Marinier, founder and general partner, New Form Capital
• Samantha Lewis, principal, Mercury
• Paul Veradittakit, general partner, Pantera Capital
• David Gan, founder and general partner, OP Crypto
• Mike Giampapa, general partner, Galaxy Ventures

Dear Sophie: Any tips for presenting a strong H-1B case? What if I’m not selected?

Dear Sophie,

I’m currently on regular OPT. My employer will sponsor me in the H-1B lottery in March.

Can you share any tips for presenting a strong H-1B case if I’m selected? If I’m not selected, then what?

— Proficient and Pragmatic