According to a recent report from the Wall Street Journal, tech startups had a rough year in 2022 by practically every metric.
For starters, there weren't nearly as many startups formed in the past year as there were in 202. On top of that, the ones that did launch (or were already established), gathered far less venture capital than in previous years. And among existing startups, so few of them went public this past year that the market for IPOs had its worse year since 1990.
Generally speaking, this startup slump is a reflection of the tough economic times we're living in. Rising inflation and ever-climbing interest rates are making it harder to acquire the capital needed to get businesses off the ground, all while supply chain disruptions and shortages are making it harder to do business in the first place.
The big takeaway? Until things start to turn around economically, startups will likely need to change their tactics, stay lean, and figure out ways to be cash-flow positive without relying so heavily on investors.
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