Sun. Aug 14th, 2022

Money doesn’t need to be protected from sudden vibrations or direct sunlight, so the term “dry powder” seems like a bad metaphor for the mountains of cash that fell on startups a few months ago.

“What I think is crazy is that some of these companies are still in the early stages, backed by very large companies that have dabbled in this stage,” said Elizabeth Yin, a general partner and co-founder of the pre-seed-focused Hustle Fund. .

“An extra $200,000 or $500,000 wouldn’t make a dent in a billion-dollar fund, even if things went horribly wrong.”

Rebecca Szkutak interviewed Yin and Kirby Winfield, co-founder of Ascend, the founders of Ascend, about the sudden, urgent funding requests they’ve received recently from founders with short runways.

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“I had one over my desk yesterday where a brand name VC ran the seed, which they now call a pre-seed,” Winfield told BestFitnessBands.

“I know this company. I know they raised a pre-seed and a seed round and now come back and say it was pre-seed and now we’re growing a seed.

With more investors content to bid things off, a traditional three-month fundraising timeline can stretch to six months. Or even longer.

As a result, founders are stuck with potentially unwanted options, such as downgrading their valuations and/or accepting flat and downside rounds.

On Monday, we’ll be displaying columns with practical advice for exploring both scenarios. Have a nice weekend and thanks for reading.

Walter Thompson
Editorial Manager, BestFitnessBands+

10 steps to deal with layoffs in a respectful way

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Image Credits: MirageC (Opens in a new window) / Getty Images

As I’ve written before, I decline most of the guest columns we receive, especially those that explain the basics. However, rules are there to be broken.

This 10-point guide to dealing with layoffs with empathy and respect can help inexperienced managers navigate the worst part of running a startup: letting people go.

“People will remember this day for the rest of their lives,” said Nolan Church, co-founder and CEO of Continuum, formerly Chief People Officer at Carta and Head of Talent at DoorDash.

“They can remember it in two ways: either you surprised them with bad news and treated them like cattle, or you did everything you could to watch out for them and help them navigate to the next chapter.”

This is how you protect your own assets if you are fired

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Image Credits: Colin Anderson Productions pty ltd (Opens in a new window) / Getty Images

Take note, startup workers: The same people who welcomed you on board when you signed your offer letter are now looking for places to save money so they can keep the business afloat.

Reducing the workforce is another way for founders to reclaim equity, as many laid-off employees don’t have enough money to exercise all of their vested options. When those options expire, they go back to your (former) employer.

If you work for a startup that extends the traditional 90-day post-service period, count your blessings.

If you don’t, this guest post from TC+ has helpful advice for budgeting, negotiation, and strategies to save your hard-won wealth.

5 investors explain why Latin America is ready to weather the crypto winter

Bitcoin sign on snow;  Latin America crypto survey

Image Credits: gece33 (Opens in a new window) / Getty Images

Even as a cohort of crypto firms continue their catastrophic collapse, investors backing DeFi startups in Latin America are “positioning themselves for a rebound,” Anna Heim reports.

She surveyed five investors who have deployed companies in the region’s crypto and DeFi sectors to learn more about how their ethos has changed since the start of winter and why consumer adoption is stronger in LatAm than in other markets:

  • Matias Nisenson, Co-Founder, DeFi Wonderland
  • Christine Chang, Head of Business Development and Enterprise, Tribal
  • Patricio Jutard, Co-Founder and General Partner, Newtopia VC
  • Claire Diaz-Ortiz, Chair of the Startup Committee, VC3; scout, Kleiner Perkins
  • Andy Areitio, General Partner, TheVentureCity

Dear Sophie: Questions about green cards and EB-2 priority dates

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Image Credits: Bryce Durbin/BestFitnessBands

Dear Sophie,

I have been using an H-1B since 2011. I have an EB-2 I-140 approved with a priority date in April 2015. I am Indian by birth so I know I will be waiting a long time to get a green card.

As an experienced cybersecurity professional, I believe I could be eligible to apply for an EB-2 NAV. Is there any benefit to applying for an EB-2 NAV now?

— Idealistic from India

The experiment to force late-stage startups to give infinite amounts of money is wrapping up

Image Credits: Nigel Sussman (Opens in a new window)

It’s not your imagination: after a deluge, venture capital has stopped raining.

According to CB Insights’ State of Venture Q2 2022 report, global venture capital financing fell 23% quarter over quarter, the second largest decline in a decade.

Megarounds of more than $100 million took a big hit: in the fourth quarter of 2021, they accounted for six of every $10 invested in private market capital. In the second quarter of 2022, that fell to 47%.

“That’s a swoon for centuries,” writes Alex Wilhelm.

Turning your startup into a bear market: become undeniably financeable

Group of paper airplanes in one direction and with one person pointing the other way, leadership/individuality concepts can be used.  (3d render)

Image Credits: Eoneren (Opens in a new window) / Getty Images

Every founder is looking for ways to save money right now, but a laser focus on saving money instead of creating efficiency will only delay the inevitable.

According to Kraig Swensrud, founder and CEO of Qualified, in July 2022, investors will not support companies that cannot demonstrate their competence in five basic KPIs.

“We’re not going to go back to the sugar levels of the past decade in a hurry, but with integrity, strong leadership and operational efficiency, we can not only survive, but thrive.”

Pitch Deck Teardown: Forethought’s $65M Series C Deck

Forethought Deck - cover slide

Image Credits: think ahead (Opens in a new window)

Last month, corporate reporter Ron Miller spoke to Forethought CEO Deon Nicholas about the pitch deck his company used to land a $65 million Series C round in 2022.

This week, Forethought shared 23 slides with us for analysis, including an eye-catching advisor/investor slide featuring Gywneth Paltrow, Sean “Diddy” Combs, and Robert Downey, Jr.

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