Ryan Dennehy is the founder and CEO of Electric.ai. He addresses what he would change about the tech ecosystem during a quick fire round.
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“Lower valuations. Just think a lot of companies are getting themselves into situations that are going to be very hard to get out of. So I think hip checking the valuations probably wouldn't hurt.”
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More from Ryan Denehy
Opinion
Only a very small percentage of VCs add value beyond capital
“A very small percentage do. Don't believe most add any value beyond capital, but I'm partial because I think my investors do a stellar job of that.”
Ryan DenehyNov 4, 2021▶ 29:1520VC Unscripted: Pricing is Crazy, Pre-Emptive Rounds are Normal, Pricing at 200x Revenue Multiple is Common, There is More Cash Than Ever. What Happens Next; Market Analysis with Ryan Denehy, Founder and CEO @ Electric
AssertionNot checkable as stated
Traditional VCs are skipping due diligence to win competitive deals
“Term sheet in two days. No diligence, right? Just like, maybe send us a board deck. And there used to be a small number of well-known growth stage fund who would do that, but increasingly what's happening is a lot of more sort of traditional VCs, I think, are …”
Ryan DenehyNov 4, 2021▶ 4:2320VC Unscripted: Pricing is Crazy, Pre-Emptive Rounds are Normal, Pricing at 200x Revenue Multiple is Common, There is More Cash Than Ever. What Happens Next; Market Analysis with Ryan Denehy, Founder and CEO @ Electric
Insight
Raising larger rounds never allows startups to skip future fundraising rounds
“No one ever skips around. You spend the money and you're back out in market on the exact same schedule you were if you raised Half as much money.”
Ryan DenehyNov 4, 2021▶ 8:0720VC Unscripted: Pricing is Crazy, Pre-Emptive Rounds are Normal, Pricing at 200x Revenue Multiple is Common, There is More Cash Than Ever. What Happens Next; Market Analysis with Ryan Denehy, Founder and CEO @ Electric
PredictionNot checkable as stated
Startups with $15M ARR valued at $1.2B will struggle recruiting executives
“Like, hey, if you're a 15 millionaire or a business valued at 1.2 billion, I think you're going to have a challenging time recruiting the caliber of senior leadership that you want.”
Ryan DenehyNov 4, 2021▶ 13:5620VC Unscripted: Pricing is Crazy, Pre-Emptive Rounds are Normal, Pricing at 200x Revenue Multiple is Common, There is More Cash Than Ever. What Happens Next; Market Analysis with Ryan Denehy, Founder and CEO @ Electric
Insight
Preemptive round markups rarely reflect actual commercial progress
“When you think about these like preemptive rounds where it's like, oh, some company raises at five hundred million in January, and then in March, they raise at a billion. It's like, it's unlikely in most of those cases that you actually engage in any commercia…”
Ryan DenehyNov 4, 2021▶ 15:1320VC Unscripted: Pricing is Crazy, Pre-Emptive Rounds are Normal, Pricing at 200x Revenue Multiple is Common, There is More Cash Than Ever. What Happens Next; Market Analysis with Ryan Denehy, Founder and CEO @ Electric
PredictionHeld up
Public markets cannot absorb the thousands of unicorns created since 2019
“If a thousand billion dollar plus valuation companies were created in the last two years, what we all know to be true is that in two to five years, like the public markets will not be able to ingest a thousand, maybe 2000 of these businesses far from it. And m…”
Ryan DenehyNov 4, 2021▶ 17:5320VC Unscripted: Pricing is Crazy, Pre-Emptive Rounds are Normal, Pricing at 200x Revenue Multiple is Common, There is More Cash Than Ever. What Happens Next; Market Analysis with Ryan Denehy, Founder and CEO @ Electric
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