But there are programs like Google Demo Day and Rise of the Rest that are reaching beyond SV for value. Several accelerators trying to copy the YC model have emerged across the US - in Atlanta, Chicago, Austin, Detroit, Raleigh-Durham, Boulder, etc.
The other day Capital Factory in Austin announced they are kicking off a program pulling Austin, Dallas, Houston, and San Antonio under one big startup umbrella:
As my ex-journalist friend so eloquently put it, journalists have to pump out stories no matter what because they have to sell you stories or their editor will fire them. So most of the stories are clickbait busybody rubbish.
It's no different than youtube vloggers or bloggers or anyone other content creator who has to pump out content to make money.
That's why the media loves trump, kim jong il and drama. It gives them something to write/talk about.
TL;DR "The total amount of money that startups have raised is still down from a year earlier, albeit by less than recent weeks. There were a few outsized deals last summer that caused this sub-index to spike. More worrying is the slump in the number of companies that get acquired or file for initial public offerings."
So it's a concentration of investment in likely winners. Unless you have some unique edge (i.e. you're B2B in an untapped niche with a near-guaranteed path to profitability and an extensive client list waiting in the wings) it might not be the best time to quit your day job.
And I expect better from Bloomberg when it comes to clickbait.
The way I interpreted the article was that more money is being poured into the seed stage funding, and late-stage funding is drying up. This has also been my experience working for a VC backed startup and seeing our competitors recently go out of business because they did not build sustainable models and couldn't get late stage funding.
Investing more at the seed stage also makes sense because it allows the investor to diversify with a smaller amount of capital, and potentially exit earlier (if the company can get late stage funding and the early investors can get out through it or a secondary market).
This behavior is in line with your observations of a concentration of investment in winners (and in line with GSV Capital's public statements from the 2Q earnings call earlier this week). It is also consistent with the article's statement that now may be a good time to quit your job, as seed stage is frothy.
> So it's a concentration of investment in likely winners.
It's not clear that's what is occurring now. I think you're confused by the outsized deals reference about last Summer - they're not saying that's what is causing the index to spike now; they're saying it's what caused the spike last Summer, such that comparing today vs a year ago should come with a flag about that data.
Huh, you may be right. The notion that the index is ever susceptible to large one-off deals, though, still makes it suspect as an indicator of the general health of the tech startup industry. Similar to how high customer concentration can cause the valuation of a business to be lower than an unconcentrated customer base with similar revenue.
> And I expect better from Bloomberg when it comes to clickbait.
It's funny you mention that ... over the past week, I've found myself seeing more bloomberg promoted posts on facebook (I've been purging/blocking "viral" pages from my feed), and thought to myself, "these are awfully clickbaity". This is anecdotal of course ... but thought it was funny to see the same thought mentioned here :)
Funding may give you the energy to take-off your entrepreneurial journey.. But it is your vision and business model that will help you stay up float and soar high. Rounds and Rounds of fund will not only make you dependent on more rounds but will divert your focus to money-making rather on solving problems.
Anecdotally : three years ago very little interest in my startup. now we've been in the black almost the whole time and are opening our first round. Was told I HAD to do a SAFE or Convertible but are shopping a priced seed round w/o a 409a and have interest over our goal.
Some of these other "fails" have been nothing but a blessing when you already have revenue and a solid growth history and projection.
Basically not huge but still a 5x bet and raising is/was easier than my previous company
Speculation: My guess is this is being driven by the slowdown in China, and the very low price of petroleum. Startup funding, circa 2008-2015, was helped by the sluggish Western economies, the 1% interest rates, and the desperation investors had for yield. That era is over. But sluggishness in China is causing Chinese investors to look overseas, and they too are looking for yield. And also, it probably helps that oil prices are so low, as that both helps Western economies and also leaves all of the investors in the oil countries looking to invest in something other than oil. (In 2008, the price of oil briefly peaked at more than $140 a barrel. In recent years it has not gone above $50 a barrel for any sustained period of time.)
It's almost as if taking a small number of data points and extrapolating them you can make the case for any narrative you'd like.