Eric Liaw is a General Partner at IVP. He explains how crossover and growth investors weigh private startup multiples against public market stock drops.
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“I think growth will be hit the hardest, because there, the universe of alternatives, particularly for some of the largest investors, is Private company A at multiple X or public company B at multiple Y.”
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More from Eric Liaw
Opinion
Liaw: Regulatory fear has chilled M&A for Meta, Google, Amazon, and Apple
“I think that probably the bigger challenge is for a lot of the biggest mega cap tech companies, fear of regulation and regulatory authority intervention is probably causing a lot of them to say, this is probably not worth our time, right? So it's kind of a fun…”
Eric LiawApr 8, 2022▶ 11:5320VC: What Happens To Growth Rounds in this New Environment? Where is the Funding Crunch? How Does This Impact M&A and Going Public? How do Crossover Funds Respond? What Does it Mean For Early Stage and more with Eric Liaw, General Partner @ IVP
Insight
Liaw: Early-stage venture is about picking; late-stage is about access
“I think at earlier in seed stages, I think there's Probably more picking going on. I think that those stages companies need capital or else they're likely to die. Capital is more like a necessity. I think as you get much, much later sort of companies that are …”
Eric LiawApr 8, 2022▶ 6:4920VC: What Happens To Growth Rounds in this New Environment? Where is the Funding Crunch? How Does This Impact M&A and Going Public? How do Crossover Funds Respond? What Does it Mean For Early Stage and more with Eric Liaw, General Partner @ IVP
Insight
Liaw: High entry valuation multiples require path to $300M+ revenue
“If something's five or ten million, but you really have conviction, it can become three, four, five hundred million in revenue, then the 600 to a billion entry price is still fine. If it's like five, 10, and you think it's gonna maybe get to a hundred, a 150, …”
Eric LiawApr 8, 2022▶ 15:2120VC: What Happens To Growth Rounds in this New Environment? Where is the Funding Crunch? How Does This Impact M&A and Going Public? How do Crossover Funds Respond? What Does it Mean For Early Stage and more with Eric Liaw, General Partner @ IVP
Opinion
Liaw: Venture capital has lost sincerity due to a self-congratulatory echo chamber
“I think that, hey, did you hear so-and-so did this seed? And then that becomes the A, and then everyone's like, oh, you're so smart. Like, it's lost some of the sincerity, and that's too bad.”
Eric LiawApr 8, 2022▶ 35:2620VC: What Happens To Growth Rounds in this New Environment? Where is the Funding Crunch? How Does This Impact M&A and Going Public? How do Crossover Funds Respond? What Does it Mean For Early Stage and more with Eric Liaw, General Partner @ IVP
PredictionHeld up
Liaw: 2022 public listings and SPAC activity will decline from 2021
“I think there will still obviously be new listings and direct listings and probably not as many SPACs. That's a different topic. I do think you'll still have some activity, but not like last year.”
Eric LiawApr 8, 2022▶ 11:3020VC: What Happens To Growth Rounds in this New Environment? Where is the Funding Crunch? How Does This Impact M&A and Going Public? How do Crossover Funds Respond? What Does it Mean For Early Stage and more with Eric Liaw, General Partner @ IVP
PredictionDidn’t hold up
Liaw: 2022 tech M&A volume will slightly exceed 2021
“I expect maybe a little bit more M&A this year than last year, just because last year there wasn't that much of it.”
Eric LiawApr 8, 2022▶ 11:4920VC: What Happens To Growth Rounds in this New Environment? Where is the Funding Crunch? How Does This Impact M&A and Going Public? How do Crossover Funds Respond? What Does it Mean For Early Stage and more with Eric Liaw, General Partner @ IVP
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