Aileen Lee (Cowboy Ventures) and Jason Lemkin discuss the venture market contraction following public SaaS valuation multiple compression in 2022.
Assertion Not checkable as stated
Lee: VC Board Member Withheld Tough Feedback to Protect LP Fundraise
“I called the board member, and I was like, hey, what's your feeling about how this, like, what kind of coaching are you giving the team about how things are going? It feels like things are off, and we are not doing the things we should be doing. And he was lik…”
Insight
Lee: Mega-funds give junior VCs $2M-$4M checkbooks as training wheels
“There's a lot of, like, basically, as these funds got bigger, they had more fee income. And so they could feed more mouths. And they would hire younger people and say, you have a checkbook. Like, you don't have a big checkbook like I have. Like, you know, the …”
Opinion
Lee: Founders Raising in 2022 Market Will Face VC Bottom Fishers
“And so, like, if you raise now, if you can avoid it, you're gonna be getting a lot of bottom fissures.”
Opinion
Lee: VCs are privately stressed over portfolio companies with unsustainable valuations
“A lot of people are sitting on super overvalued investments. And depending on what price they paid and what's in their portfolio, they are super stressed out right now because they don't see a path for their portfolio companies or a chunk of their portfolio co…”
Disclosure
Lee: Seed founders pitch $6M rounds but quickly reduce asks to $3M
“Right now we're seeing a lot of seed extensions. We're seeing a lot of seed founders who are sending us decks that have a six million dollar seed raise in them. And I'll email the founder and be like, Hey, this looks really interesting. Are you still thinking …”
Assertion Supported
Lee: LPs Have Put on the Brakes for Venture Funds Raising
“Investors, LPs in venture funds have basically put on the brakes. And so any fund that is trying to raise right now is having a pretty hard time for the most part.”