At the beginning of the pandemic, I thought startup investing volumes would drop dramatically throughout its duration. I was wrong.
Venture capitalists and angel investors seem to be funding more companies than ever. And much of that funding is going to startups that are benefiting from current trends — like work-from-home technology, food delivery and remote medicine.
There’s certainly a strong case to be made that some of these trends will outlast the pandemic. So I’m open to deals in these “hot” areas. But I often find these opportunities are very expensive and lack traction. I think some investors are betting that this “new normal” will be permanent. So they’re putting money into startups even when the deal is over-priced or not yet proven. But I don’t think this “new normal” is actually going to last post-pandemic.
The only reasonably-priced deals to be found these days are in areas that COVID-19 has negatively impacted. So I’m starting to look beyond the lockdowns. I’m looking for startups that will benefit from things returning to a more normal state. I think that we’ll get there eventually. And signs seem to be pointing in that direction.
So I’m starting to explore startups that depend on real-life gatherings — such as conference tech or business travel. I believe these things will return eventually. And many of the innovative companies that make it through this difficult time will find a wide-open market on the other side.