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The fundraising landscape is shifting in 2020

Hustle Fund’s
Extra Crunch

Elizabeth Yin

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the San Francisco Bay Area
Silicon Valley
the Bay Area
the SF Bay Area

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San Francisco

the Series A and Series

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   Negativity   56.00%
The New York Times
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When I was a founder many years ago, I felt like I heard constantly conflicting advice and opinions on raising money for my startup.It’s easy to raise. Today’s fundraising landscape is particularly an interesting time of bifurcation that’s worth laying out in detail.Hustle Fund’s Elizabeth Yin discusses 2020’s fundraising landscapeIn the San Francisco Bay Area, if you’re a founder who has a “well-branded” resume, it’s a fantastic time to raise money at the earliest stages. If you did any of these things, it’s a great time.For these founders, I’m seeing massive party rounds here in San Francisco — $3 million – $5 million seed rounds. The reality is that San Francisco mostly has poop on the ground and a small number of people will find a Benjamin once in a while.I’m seeing valuations well above $10 million post — even $20 million post for hot seed-stage companies. There’s no such thing as a “typical” valuation.Friends outside of Silicon Valley often ask me if I think this time VCs will favor profitable companies over fast growth.I think the answer is VCs would love to back profitable companies with fast growth.(That, of course, begs the question in this day and age with other debt or revenue-based financing options why such a company would raise a lot of VC money, but that’s besides the point.)That said, I do think that in this new era we are entering in 2020, companies that focus on profitability will separate the winners from the losers in the next few years. As we go into this new age where frugality is a strength, I think that the startup journey will actually be harder for the founders who are able to raise their large seed rounds so quickly at high valuations.

As said here by Elizabeth Yin