#26 – The Bubble we are in and its implications – Part 2 - a podcast by Bertrand Schmitt & Nuno G. Pedro

In our second and final episode on the Bubble, we share what is happening in Venture Capital, on the exit - IPO, M&A, etc - front, as well as share clear “so-whats” for entrepreneurs and VCs. For in-depth views on the status of the economy, listen to our previous episode, episode 25.

Navigation:Section 1: What is happening in VC? (02:05)
Section 2: Exits are great, though, right?! (17:52)Section 3: So-what? Implications for entrepreneurs and VCs (25:57)
Conclusion (43:49)Our co-hosts:

Bertrand Schmitt, Tech Entrepreneur, business angel, advisor to startups and VC funds, co-founder at App Annie, @bschmittNuno Goncalves Pedro, Investor, Managing Partner, Founder at Chamaeleon, @ngpedro

Our show: 
Tech DECIPHERED brings you the Entrepreneur and Investor views on Big Tech, VC and Start-up news, opinion pieces and research. We decipher their meaning, and add inside knowledge and context. Being nerds, we also discuss the latest gadgets and pop culture newsSubscribe To Our Podcast



Intro (01:34)Nuno: Welcome to episode 26 of tech deciphered. This episode will conclude our two-part series on the bubble and why we actually believe there is one going on. In this episode, we will discuss the VC landscape and how it is evolving. We will talk about exits, not just IPOs, but also other types of exits like mergers and acquisitions and how that landscape is looking like.

And finally, we will end up with something pragmatic, the"so what", the takeaways, the implications for both entrepreneurs and investors. 

Section 1 - What is happening in Venture Capital? 
(02:05)Nuno: Moving to venture capital, there's a lot of interesting elements to talk about. Some really interesting analysis from our friend Tom Tunguz but also of what's happening in the macro space, some analysis of what we've seen from PitchBook and CB insights, it seems we're going to have an incredible year in venture capital. This is it. There's no crisis there's a ton of money, dry powder, there's new funds, I actually have a new fund going. So I'm very happy with that, but in some ways it's like, woh, this is all fantastic. Increasing everything, increasing everything, more deals, more money deployed.

We're all great. We're going to have, a flagship year in venture capital. And somehow I'm like I like being in the market. We just closed our first deal, which is great. Thank you. So what's going to happen? In our micro world of startups and entrepreneurs and venture capital firms, 2021 is going to be an amazing year, but what's going to happen?

Bertrand: Yeah. And to share some numbers it's pretty insane what we see. And for me, what's crazy is that it's at every range. So maybe it varies by country, by industry, but overall if I take Series A valuations, for instance, you have seen a jump from what? like more than 50% in two quarters this is the very definition of insanity.

I'm not sure if we have ever seen that, and it's happening. At every level in the stack. So maybe early on in the pandemic, it was less true that it was at every level of the stack. Maybe, initially it was more: you are only investing in people you already knew, in companies you already knew, the first quarter or two. And because you are not used to work like this, you didn't know how long it would be like this. So you had a different approach that maybe favored existing companies bigger rounds, insider the rounds. But now I believe that we're at a stage where it's not at all about that anymore. 

Or not just that anymore. It cannot be: to stay competitive you have to stay in the market, you have to invest. And maybe on that point maybe not every fund agree. We have a wide range from Tiger Global investing I forgot how many deals a day, actually 1.3 deals a day from Tiger global these days. But at the other extreme in a global ranking I have not seen Sequoia U S in the top 10 investors. So I wonder if there is less investment from them and they decided that right now is n...

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