When looking at how TechCrunch+ covered venture in 2022, we didn’t see a lot of positive news. We saw layoffs, demands for growth at all costs, VCs sitting on mountains of cash and low funding for minority groups — again. While some of these things may seem contradictory, that’s what VCs thrive on.
Let’s get into our top TechCrunch+ venture stories of 2022:
Layoffs swept through the tech industry all year long.
Natasha Mascarenhas spoke with Nolan Church, who helped lead Carta’s 2020 layoffs as its chief people officer. However, we’re going to see more layoffs in the new year. Church “estimates that another 30,000 to 40,000 tech employees around the world will be laid off in Q1 2023 — a number that follows the more than 100,000 layoffs so far in 2022, according to layoffs.fyi data,” Natasha reported.
In 2021, startups were directed to grow at all costs. They overhired and had inefficient customer acquisition, but venture capitalists funded them. This year, we saw something a bit different. Rebecca Szkutak reports that VCs decided that using up cash in the name of growth may not have been the best plan. But did we see VCs follow through on their demands?
Startup consulting firms are raising venture funds on their own to have a stake in companies they’ve already partnered with. It’s a little more complicated than that, but Rebecca raises the question, “Why are so many consultant-led venture capital funds launching now?” It turns out startups were asking them to.
While we may have seen startup consultant firms handing out money, we didn’t see the same from traditional VCs, even though they have the money to do so. Beginning in 2020, there was a lot of talk about funding more historically unrepresented groups — but we haven’t seen VCs put their money where their mouths are. However, they are funding some people. As Rebecca puts it, “Because they aren’t backing no one — they’re just backing everyone but you.”
Dominic-Madori Davis looked into the amount of capital Black entrepreneurs raised in Q3 of 2022. To put things into perspective, Dom wrote, “Adam Neumann raised more in one round than all Black founders could in one quarter. Adele is worth $220 million. However, these numbers are not necessarily surprising. TechCrunch reported investors often retreat to their networks amid economic downturns, taking fewer risks on minorities.” Dom will be keeping tabs on this data in 2023.