Zennstrm calls the end of highvaluations era, says founders and VCs must remove stigma of downrounds
- He said: “Atomico hasn’t led many down rounds, so this is about my personal experience as an entrepreneur and from situations I’ve seen talented founders struggle with years after Atomico’s initial investment.
- And the less runway a business has, the riskier that company becomes.”The alternative after 6 months could mean “a rescue financing littered with aggressive liquidation preferences and exit clauses.. Don’t let that be you,” he said.
- It’s market dynamics.”He added that startup founders currently in fund-raising mode should raise right away: “The biggest issue with down rounds is that people leave them so late.
- I was even more motivated to prove I could build a successful company.”Ending on a positive note he said: “I started Kazaa in 2000 and Skype a few years later – just after stocks crashed 80% in the dotcom bust.
- But he challenged Slush attendees to think about down rounds differently and not to take it personally: “Firstly, ‘down rounds’ are just a function of the broader market.
- As the world moves into economic head-winds and geopolitical uncertainty, European founders must get used to taking tough decisions to ensure the survival of their startups.
As the world moves into economic headwinds and geopolitical uncertainty, European founders must get used to taking tough decisions to ensure the survival of their startups. This will include getting [+5488 chars]