What is expected for venture capital and startup investments in 2023 was what two publications, from Diario La Segunda and La Tercera respectively, tried to answer this weekend.
Although during 2022 the venture capital industry has decreased compared to the previous year, due to different global factors, it is expected that in 2023 the focus will change.
"Until recently, there were startups that quickly became unicorns by making rounds in which they raised high amounts at very high valuations. Now the fundamentals that led to these investments are being reviewed and there are concrete cases of companies that have had difficulties in raising financing under the same terms," Francisco Guzmán, president of the ACVC, explained to La Tercera.
Still, locally there is the advantage of the large number of new players that have joined the VC world, he said. "In Chile, we have family offices, corporate ventures and some institutional players entering the industry. There is an important learning curve in the investment process and I see that venture capitalists are very focused on making the right decisions, without getting carried away by fashion or the attractiveness of a sector or a company, trying to invest at valuations that make sense and are justifiable according to their investment thesis," he explained.
Although the funds that were committed will continue, in 2023 it will be difficult for new ones to appear, said Andrés Meirovich, director of the ACVC and Managing Director of Genesis Ventures. "There is no longer a boom like last year, where if a startup did not enter a round, it did not matter because there was another one immediately. They were very fast investments with very high valuations. What will happen (and is already happening) is that VCs will be calmer and more concerned about the numbers," he said. Although this is a risky industry, "there were indicators that were excessive even for VCs," he added.
The focus of startups in 2023 should be on sales, said Claudio Barahona, partner at ALAYA CAPITAL."... they have to worry about the real problems of their clients and focus more on turnover. But above all, they have to be clear about the path, regardless of whether or not they are in break even, since a fund raising usually takes about 18 months. They have to manage that time well for their focus and strategy," he said.
Stefanie Sherman, vice-president of the ACVC and manager of Digevo, told La Segunda that: "Investors will be more cautious, but I believe that the number of deals will remain the same or increase. The investment will be with smaller but more diversified tickets, in a greater number of startups. And here corporate ventures will be key, and we will continue to invest in early stages.
Check the notes here
La Tercera: https://bit.ly/3PSOoh3
La Segunda: https://bit.ly/3WpEZA1
