Venture Capital Trends 2022

In conversation with John Frankel

In conversation with Mark Allen, John explains how his work over the years has helped companies with seed rounds: raise hefty Series B funding.

In conversation with John Frankel, Partner at ff Venture Capital, on VC trends in 2022

With a record number of new unicorns and a fast-expanding investment tempo, global VC financing broke new history last year. While this is good news for entrepreneurs and the startup ecosystem, it also means that financing competition is fiercer than ever. That being said, While growth equity investors made record-breaking investments in high-growth, earlier-stage businesses last year, they have scaled back this year. Early-stage capital totaled $13.7 billion last month, down 22% from the $17.6 billion average monthly funding in 2021.

Venture Capital Trends 2022 Valuations will probably decline and the pace of investing will stall as late-stage investors reduce their commitment to private company investments. But it also means that many venture capitalists, who have recently raised record sums of money, now have the opportunity to compete for investments in the finest businesses at more affordable rates. Sustainable investment It is another trend that has gained momentum. Many people have been encouraged to invest in businesses that will have a good influence on international relations, environmental issues, and, most importantly, public health challenges as a result of the recent trend of socio-political awareness in an era of global trouble. Sustainable investment is gaining popularity as investors start to understand that these results are not as unconnected as they may appear at first. Consumers have always been curious about new technologies that they may learn to use to better their lives. To assure efficiency and maintain their competitiveness, businesses continue to employ automation. As a result of several firms and regular consumers profiting from recent improvements within the industry, the fintech sector has recently experienced a rise in inmarket success.

John s Philosophy John is the Founding Partner at FF Venture Capital, a firm that started in 2008 and has been empowering founders and companies for 14 years. Prior to founding FF venture Capital, John worked at Goldman Sachs for 21 years in various roles. In conversation with Mark Allen, John explains how his work over the years has helped companies with seed rounds: raise hefty Series B funding.

We have over 14 years of data since starting in 2008 and while some would argue that that s not great, industry figures show that only 10% of seed companies ever make it to a hundred million revenue…..Only 40% of companies found in a given year ever get to a hundred million revenue run rate and we have 6 of these companies in our portfolio with two more in the pipeline for hitting that number this year With a wave of digitalization in the last decade or so, there are a lot of emerging trends that have picked up hype from digital currencies to NFTs, to virtual reality and new realms in AI. According to john every sector has an exciting emerging trend so to speak and the main reason behind it is digitalization.

John Frankel and Maciej Dabrowski, an Associate out of ffvc's Warsaw office, at their NYC office.

Venture Capitalists often look at a competitive advantage in the market which can very much be driven by emerging and upcoming trends. John explains this by elaborating on what one of his portfolio companies, Respo, is doing “By taking an analog data set and digitalizing it, they can create a 3D point map of any game…even a game from 1975” He further explains that such data can then be used in a multitude of ways from realtime sports betting to training, scouting, healthcare, insurance, etc. Speaking of digital currencies, since bitcoin is less regulated than traditional investment, venture capitalists have discovered that it offers a more alternative trading strategy. Similar to an initial public offering (IPO), cryptocurrencies employ initial coin offerings (ICOs), which let businesses generate money using virtual currency. Both VCs and businesses searching for more adaptable investment or funding methods have found this approach to be highly successful. However, the price of bitcoin was $20,097 on June 20th; a 70% decline from its price in November. At its high in November, the price of Ethereum, a popular cryptocurrency, was over $4,800; now, it is less than $1,000. The price of bitcoin and other cryptocurrencies has been falling all year, and it has become worse since the Federal Reserve said it will raise interest rates to attempt to combat inflation. As investors sell riskier assets at a time when the prospect of a recession is growing, what is happening to cryptocurrency is, in part, an extreme version of what is happening to equities. In conclusion, Only 40% of companies found in a given year ever get to a hundred million revenue run rate and we have 6 of these companies in our portfolio with two more in the pipeline for hitting that number this year