Various individuals in the startup ecosystem believe that the current difficult scenario is merely a blip on the radar and that a lot of correction is underway, with the finest companies surviving. It's an exciting time for companies, according to Sanjay Enisetty, founder of early-stage venture fund 50K Ventures. "It's an intriguing time for entrepreneurs, and it's not a bad time for them. It's coming to an end, and only the best companies will survive. Founders with perseverance and persistence survive in business, but those who were unprepared and simply intended to ride the wave would undoubtedly fail "IANS spoke with Enisetty.
He believes it is only a blip on the radar, not "Doomsday," and that there will be a lot of adjustment, with excellent companies remaining. He sees this as a settling process in which only the best firms will survive and investors will wait and watch. "It's only a two-to-three-quarters-long phase. In some ways, this is beneficial since a lot of dust will settle, leaving just the best enterprises." According to Enisetty, many businesses must make cost-cutting and resource-downsizing adjustments. "I don't think series B and C will be produced. A large sum of money has been placed on hold."
He noted that numerous businesses achieved unicorn status last year. Approximately every month, 1-2 companies become unicorns, bringing the total number of unicorns to 100. However, there was an IPO frenzy, and every company wanted to go public. "Everyone's reality dawned on them when the decline began," Enisetty said. "Unicorn status was created so that they could get a head start on the IPO process. It's not easy if you don't have fundamental rights. According to statistics, only 17 out of 100 unicorns are profitable. In terms of revenue, other unicorns are extremely negative. Financial discipline is a fundamental requirement for any organisation. In general, it was not witnessed in these businesses "he stated
He stated that practically every week, one or more companies lay off employees. "VCs held portfolio meetings and urged them to cut costs and not to execute any aggressive marketing strategies, which is why 7-8 companies have laid off roughly 5,000 workers... we will see more of this in the following days." According to him, the scenario is affecting mid-stage, early-stage, and growth-stage businesses. Enisetty also feels that a value correction will occur. Profitability, break-even, and eventually scaling will be the focus. The majority of models must be able to sustain themselves, become profitable, and then consider scaling.
He believes it is only a blip on the radar, not "Doomsday," and that there will be a lot of adjustment, with excellent companies remaining. He sees this as a settling process in which only the best firms will survive and investors will wait and watch. "It's only a two-to-three-quarters-long phase. In some ways, this is beneficial since a lot of dust will settle, leaving just the best enterprises." According to Enisetty, many businesses must make cost-cutting and resource-downsizing adjustments. "I don't think series B and C will be produced. A large sum of money has been placed on hold."
He noted that numerous businesses achieved unicorn status last year. Approximately every month, 1-2 companies become unicorns, bringing the total number of unicorns to 100. However, there was an IPO frenzy, and every company wanted to go public. "Everyone's reality dawned on them when the decline began," Enisetty said. "Unicorn status was created so that they could get a head start on the IPO process. It's not easy if you don't have fundamental rights. According to statistics, only 17 out of 100 unicorns are profitable. In terms of revenue, other unicorns are extremely negative. Financial discipline is a fundamental requirement for any organisation. In general, it was not witnessed in these businesses "he stated
He stated that practically every week, one or more companies lay off employees. "VCs held portfolio meetings and urged them to cut costs and not to execute any aggressive marketing strategies, which is why 7-8 companies have laid off roughly 5,000 workers... we will see more of this in the following days." According to him, the scenario is affecting mid-stage, early-stage, and growth-stage businesses. Enisetty also feels that a value correction will occur. Profitability, break-even, and eventually scaling will be the focus. The majority of models must be able to sustain themselves, become profitable, and then consider scaling.
