VCs' flight from early-stage investments shrinks innovation pipeline - Business Insider

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Silicon Valley leaders say VCs that are now flocking to safer late-stage investments rather than early startups could shrink their future pipeline of growth companies to back

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Such strategies run the risk of eventually drying up the pipeline of new ideas that VC firms at every stage of the funding process rely on. Cameron Stanfill of PitchBook, Jennifer Friel Goldstein of Silicon Valley Bank, and Matthew Lee of Certent fielded questions and talked about how the economic fallout of the pandemic has reshaped traditional funding patterns.

"I would expect that some of the later stage funds eventually are going to need to deal with their own pipeline and supply concerns," Goldstein said. "If everybody is only investing in late-stage, there are not going to be interesting mid-stage companies for them to invest in.""The late-stage companies in VCs' portfolios are likely where they have a lot of value, still wrapped up in companies like that," Stanfill said.

 

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