Get ready for a seismic shift in the venture capital (VC) industry.
Amid the downturn in the public markets, the swoons in the Nasdaq (down more than 20% YTD), the PYMNTS FinTech IPO Index is down even more, off a staggering 35% YTD through last year.
That index could be used as a proxy for the new and emerging technologies tied to the great digital shift and the early-stage capital committed for companies that ultimately went public (which is a typical VC exit strategy). Call it the great fizzling.
“VCs were getting greedy,” SineWave Ventures Founder/Managing Partner Yanev Suissa told Karen Webster, and backing funds worth billions of dollars that presupposes that there would be 300 great companies to invest in.
Executives in the startups themselves are sweating a bit, said Suissa, because they need the capital to underpin growth for the next two years without having to tap expensive financing options.
He said the days of private capital willing to commit money at implied valuations…