Crunchbase Macro Update | Surprising VC Narrative Violations & AI's Big Break

[00:00] The most interesting trend that we saw in Q2 was that AI funding massively picked up. It doubled. [00:06] quarter over quarter, and also euro over euro almost to 24 billion. And these are global numbers. The US was around 70 billion. So we saw a lot more money going to the AI sector this past quarter. And I think [00:19] What's interesting about that is when, you know, ChatGPT launched for all of 23, we did see AI funding pick up. We did see proportionally more dollars go into AI. We saw that globally. We saw that in the U.S. market. But it's almost like six quarters after that launch that you see the massive uptick. And I think what what that shows is within the private markets, it takes time for those companies to grow. It takes time for those investors to find those targets. [00:49] you know, multiple fundings over this time. And they're now at the point where they're raising those very, very large rounds. So, you know, AI as a sector represented 30% of all investments globally. So pretty noticeable. And obviously, the biggest one was Elon Musk's XAI, which was a $6 billion round. But there were a lot of other companies in the sort of AI sector that raised super large rounds. [01:20] Welcome to Sorcery. I'm your host, Molly O'Shea, founder of Sorcery. Today we have Janae Tear, [01:26] Crunchbase News' senior data editor. Janai conducts strategic research to explore and report on trends within private company data. She focuses on global venture funding trends, artificial intelligence,

[01:38] FinTech and gender equity in venture in tech. This is a fun conversation because it's around Labor Day, coming back from the VC slumber when tech markets are very quiet and people are out on the beach. So hopefully we can provide some perspective for macro trends and a bit of a refresh on Bitcoin. [01:59] what we do. [02:00] Hi, Janae. It's great to have you on. [02:03] Hi, Molly. Great to be here. Thanks for inviting me. Of course. I'm so excited. So you are a senior data editor at Crunchbase News and you have all the data on the markets. So I would love to just go deep into this and this will be airing right before Labor Day. So it's going to be a good nod to all of the VCs who have been in the Hamptons, who've been on the Mediterranean or wherever they like to hide for the summer. [02:33] Um, but that being said, I'd love to just get back into it and understand what do we need to know? [02:41] coming back to work. Sure. And just, you know, looking at Crunchbase and sort of where I've been, I've been at Crunchbase a very long time. And my work at Crunchbase has always been focused on the data and working with the data. I used to run a lot of our data teams and data projects. And that has massively ramped up since I've left that team. And then I started reporting in 2015 on [03:02] on what was happening from the data. So when you work with data all the time, you want to do something useful with it. And one of the first reports I did was looking at women, female founder trends, just because we realized we have this great founder data set. There was a whole discussion taking up in Silicon Valley about equity for women. And I thought, hang on a minute, we could look at this. And so we were the very first data set to add gender to the data set and then really

[03:32] I feel very privileged because I get to look at the data and there's a lot, we follow, [03:37] industry leaders, we talk to a lot of analysts, we talk to VCs, we talk to founders, we get a good sense of what's happening from talking to people in the market. But then it's always super interesting to look at what the data is saying alongside that and whether the data fits with the narrative that people are seeing, or whether there's different things happening in the data. And I feel like I'm always, I have this advantage because I'm always discovering and seeing things, because you can look back and sort of understand what does this all mean. And I think from a venture perspective, you know, we are... [04:06] Broadly speaking, we're two years into a venture slowdown. And so we really saw the slowdown kick off in Q3 2022. It started in Q2. Q1 was very strong in 2022. So we're two years into the slowdown. And what we've seen is from Q3, [04:22] Funding came down, this was 2022, two years ago, funding came down, [04:28] Q3, it came down quite significantly. And since then, it's sort of been... [04:33] bumping along so it looks like it fluctuates and the fluctuations quarter over quarter which is how we do our sort of best tracking is really based on large rounds so large fundings come in in that quarter and you will see funding pick up a little bit and then it'll go down and so for the last quarter in q2 it was around 79 billion globally and typically more than half of that is or around half of that is is for the u.s market which is the largest market

[05:03] Thank you. [05:03] Market track, that was up. [05:05] quarter over quarter, but if you look at this year for the half year, it was sort of flat or a little bit down from a year ago. So [05:12] Not a big shift. [05:14] But the quarter was up and, you know, one of the questions we're asking is with the quarter up a little bit, is that a good signal for the venture markets? [05:23] And is that up year over year or just this year? [05:28] Yeah. [05:29] It's up if you look year over year and also at the quarter. And I think the main or quarter of a quarter. And I think the main reason it's up, what we could see is, again, those larger rounds. So there was some big mega rounds that happened as well as funding to AI companies. So that was the two kind of trends that we saw. And we also saw some of the more active venture investors that have really been holding back, [05:59] But some of the key large multistage investors seem to be leaning in a little bit more. So that is great. [06:06] a glimmer that there's a little bit uptick, but these investors at the same time can step back and we're going to be coming out with our Q3 report soon. And as you say, everyone's been off over the summer, so things might have just sort of fluctuated down a little bit. [06:20] It'll be interesting to see. There was one data request that we asked your team and it was so great. You guys came up with this custom report. But we wanted to see quarter over quarter the last like 18 months, how many deals were done and how much capital was deployed within each stage.

[06:50] getting done. So one would extrapolate from that that most of the money is coming from later stage. That's where the money would be swelling. So the money would be swelling. So the money would be [06:59] I don't... It's like a really interesting... [07:02] scenario, because I feel like that's been most of the narrative this year is tiling all of this capital into later stage rounds for AI, for hardware, for really capital intensive businesses, just based on the current trends. And I'm curious, are you seeing that? Is that what the narrative is? Yeah, I think the most interesting trend that we saw in Q2 was that AI funding massively picked [07:32] you're almost at 24 billion. And these are global numbers. The US was around 70 billion. So we saw a lot more money going to the AI sector this past quarter. And I think what's interesting about that is when, you know, ChatGPT launched, for all of 23, we did see AI funding pick up, we did see proportionally more dollars go into AI, we saw that globally, we saw that in the US market. But it's almost like six quarters after that launch, that you [08:02] that shows is within the private markets, it takes time for those companies to grow. It takes time for those investors to find those targets. A lot of these companies have raised, you know, multiple fundings over this time. And then now at the point where they're raising those very, very large rounds. So, you know, AI as a sector represented 30% of all investments globally. So pretty noticeable. And obviously, the biggest one was Elon Musk's XAI, which was a $6 billion round.

[08:32] AI sector that raised super large runs. [08:35] And are you and your team, are you reporting these numbers based on the date of funding or the date of the announcement? So we do it based on largely based on the date of the announcement, because that's when, you know, when the press release comes out or when the news comes out. That's sort of the most definitive moment to know. And if we did it based on when people invested, the data would shift all the time. [09:05] fundings which don't typically get announced. And sometimes those get added way after a quarter or a year just because you raise your Series A and then you go and put your seed funding in. But typically, it's the announced date. But we also track, you know, we work with investors on a monthly and quarterly basis to update if we're missing deals that they've done as well. So there might be some that come in that way. We also track the SEC. So there's a whole host of ways in which we go after [09:35] you know, most of the data is really around that announced date. In terms of [09:40] the amount of dollars deployed and the number of deals. I want to go back to that and dissect it a little bit more. So you mentioned XAI was a pretty large component, a $6 billion round. That's huge. [09:55] Did you see concentration into other companies, too? And what were those companies? [10:00] We saw, you know, companies like CoreWeave, which is also in the AI space, Wave, Scali, and then also Zara Therapeutics, which is a stealth company that launched. They raised a billion dollar in funding. They're sort of in the health care space using AI models. So a lot of those very large rounds that we saw this past quarter went into the AI sector.

[10:26] Is there any way to predict them? Like how, how do we continue monitoring this going forward? Is this going to be another surprise every quarter? [10:36] You know, I think what it demonstrates is that, you know, and some of this funding is not just coming from the venture community. Some of it is coming from private equity and the private equity space. These are very, very large fundings and also from companies themselves are investing. We've seen Microsoft, Google and Amazon invest quite heavily in the space. So I think it'll be, you know, one of the things that I did look at is in the AI sector, how does that compare to other sectors by stage? [11:06] You know, when you look at seed and early stage, it was sort of in line with what you see broadly for AI. It was sort of in line proportionally with those markets. But when you look at late stage, it was fewer companies raising very, very large fundings. And so there are these companies that are really sort of breaking out on the AI side. I think there will be more, but I think they're they're very competitive, these deals. And there are fewer of them that are that are really breaking out is what I noticed for the AI sector. [11:36] Thank you. [11:37] Have you started to track the investors that are most active? Most of the investors that I talk to will say that the sort of foundation model layer companies are not venture backable. They have to raise so much money and it's such a competitive space. And if you when you have Google and Meta and Microsoft and Amazon all playing in the space as well, these are not really venture back and backable companies. You know, having said that, there are some venture backers who've gone into those sort of foundational model companies.

[12:07] opportunities is in the sort of infrastructure layer, which is all the companies needed to kind of manage the data and process the data and manage those models. So that's where the sort of infrastructure, the tooling layer, and then the other area where investors are focused is, [12:24] is on the application level. So I think the foundation level companies, there are investors investing in those, but the amount that needs to go in is so big that they're not necessarily diving in, but definitely at all other levels of AI. And I think what's interesting there on the application level is that there are new companies that will come out. And I think Clio and Harvey are a good indicator of this. I don't know if you saw Clio raised a $900 million round. [12:54] It's almost 16 years. [12:55] years old. And I think that round of 900 million really represents the promise that AI can bring to their technology. They have a lot of market share already. They have a lot of customers and bringing AI in will bring much more benefit to those customers. And so you can justify such a large round. And then if you look at Harvey, Harvey just became a unicorn as well. That's a new company specifically focused on professional services and legal services using AI. [13:25] Slide it out or measure it out as the incumbent companies who are layering in AI to existing customers, which do have an advantage, and then the newer companies who come out and building from AI. [13:37] right off the gate.

[13:39] You mentioned earlier [13:41] Because you're watching this data over time and you're observing it, you're making analyses, you track different narratives. And so I'm sure you catch wind of something that might be happening or might also not be true. Have there been any narrative violations that you've seen throughout the last year and a half that just aren't aligning with [14:08] what people are talking about? I think the biggest one is the kind of AI narrative and how quickly that took off because of the launch of ChatGPT and everyone got focused on it. And everyone kept on saying, this is going to change the funding data massively. And even though AI was a growing sector, it wasn't as significant as I thought it would be. It didn't really change [14:38] as a thesis for investing. It kind of took some quarters for that to kind of play out. Everyone, you would have thought everyone was going to throw a lot of money immediately. And obviously, OpenAI did raise that $10 billion round right out the gate. But I think what was interesting is to see that it took some time for that kind of momentum to build within the ecosystem. Hey, we'll get right back to the conversation after a word from our sponsor. [15:03] Sorcery is brought to you by Archer. I'm genuinely amazed at what Archer has been able to accomplish. Archer's goal is to transform urban travel, replacing 60 to 90 minute car commutes with estimated 10 to 20 minute electric air taxi flights. They are safe, sustainable, low noise, and cost competitive with ground transportation. Archer's Midnight is a piloted four passenger aircraft designed to perform rapid back-to-back flights with minimal charge time between flights.

[15:33] for passengers by providing safe and efficient access to people, places, and events across the communities they live. Visit Archer.com. [15:42] I also think, you know, looking back at [15:45] In a way, the venture markets react more slowly, obviously, than the public markets. But I think what was interesting is Q1 2022 was a very, very strong quarter. And I think, you know, in a way that was because if you look back at COVID, when COVID started happening, what we saw in our data is there was an immediate small pullback. And then venture was off to the races again, as everyone realized if you're sitting at home and everyone's kind of trapped digital services are going to become way more important. [16:15] And it took almost a year. 2021 was the biggest year. 2020, we were starting with COVID, but the biggest year for funding was 2021. It doubled year over year. And I think the same thing happened in Q1 2022. There was this sense of... [16:31] you know, is this a blip? Is this going to be more sustained? How do we react? And Q1 22 was incredibly strong. And then I think quite quickly in that quarter, there was a realization that was going to be, this was not going to be a blip. This was going to be much more sustained, that the markets were shifting quite dramatically. Tech stocks dropped dramatically. And so the pullback happened, but you started only seeing it in Q2. So I think for me, it's the venture markets that [16:55] take a little time to react. [16:58] And it's not always immediate. [17:00] Yeah, that's a fair analysis. I know for a fact, like being on the investing side, it was not the most fun period.

[17:10] It was a cascading event of a lot of dramatic things and a lot of different elements. Like, A, we had massive overvaluations on companies that had zero to... [17:23] like minimal revenue, but got really great multiples. Um, [17:29] And so that's one element. [17:31] Another element, uh, [17:33] SVB collapsed. And so... [17:37] That created more fear and panic within the markets of like, what is truly stable? Is anything stable? Like what is VC built on and this tech hype? [17:49] And then, you know, throughout the last year, we had a real I think like, if anything, the chat GPT moment was amazing because it then gave everyone at least some like revitalization and excitement to be like, oh, this is our job. [18:07] the innovation and now apply it. And this is our time to shine. And so that was good. You know, it got some energy back in the system. But there were so many different things happening that were bringing a much needed change. [18:21] just rebalance of the system. And then, um, [18:26] We still have a hangover effect of the high valuations and there's going to be shutdowns continually. I think Carta announced that there's a 60% increase into Q1 maybe? Not sure. But those are going to increase. And then...

[18:44] Yeah, it's been a wild ride. So I would say it's not bad that we have this good moment and we can continue to find companies and back this next innovation cycle that's kind of taking off. Another thing that I wanted to mention within that is. [19:03] We have... [19:04] a big conflict with antitrust and the M&A markets, which are really pulling back exit opportunities. Not only are the IPO markets shut, but the M&A markets, it's been really hard to get large transactions over the line. I'm curious from your standpoint, [19:21] Is this a cohesive narrative? Like, are we seeing most of M&A shutdown or is it really large M&A transactions? [19:32] I think definitely the big tech acquirers are, you know, are very concerned. And obviously these deals that we've seen around acquiring, doing licensing deals and acquiring talent within the companies is very much a reaction to the regulatory environment. And I think, you know, what we've seen on M&A is that it has picked up a little bit. And this year it's picked up a little bit this quarter, but not as much as people have expected. [20:02] have been off to the races and AI would and M&A would have been back. But, you know, in speaking to analysts, the expectation is that the IPO markets this year will still there'll be some that come out. There'll be some great companies that decide to kind of test the public markets. But broadly, they see possibly next year, the IPO markets coming back a little bit more. And it's

[20:26] Who knows what that looks like? But definitely the expectation wasn't this year. And I think a lot of people focused on the M&A markets are going to be a lot stronger this year. So I think there has been some pickup. We've seen, you know, I was just looking at who were the most active acquirers. And there's obviously the private equity folks. If prices have come down and there's attractive targets, they're going to be looking. And two stood out for us, EQT and KKR, who have both been quite active this year. [20:56] of being more active. Again, if prices are coming down and there's technology that you want to bring in [21:01] This is a good time. And then also privately highly valued companies are also seen to be, you know, companies will go out and acquire because for a lot of founders out there, if they're not going to go be able to go, if they're growing, but they're not going to be able to go public in the next three to five years, they might think, well, looking at an acquisition target might be, you know, a comfortable fit. [21:31] It hasn't quite happened. But as I say, if these acquisitions had a deep in acquisitions, it would have been pretty strong. So I think there is some pick up on the M&A front, but not quite as much as people were hoping or expecting. [21:48] Are there any particular categories within M&A that are... [21:52] going well right now? Is it software? Is it industrials? Is it specific to tech? Or are we seeing other categories?

[22:00] Yeah. [22:01] I think the companies that have stood out, you know, there's some in the cybersecurity space because there's so much demand there. We've also seen some in the cloud kind of technology space, obviously in AI as well, because there's a lot of players, not just the foundation model companies. So I think we've seen a bunch in that area. So I'd say those are the areas that dominate on the software side. And then in biotech and health, there's a lot going on. It's less my area of expertise, but there's a lot of activity on the funding side in biotech and health care. [22:31] And that sector still stays strong. Everything's down. But relatively speaking, that's been one of the strongest sectors, both for investment and for M&A. [22:41] There's another interesting outcome with exit markets. [22:45] being shut, or at least very hard to get through. And that's these large companies staying private much longer. Within that, we have like Stripe, we have Anderol, we have these really large companies. From your perspective, have you seen any specific kinds of transactions happen within them? Are they doing more secondary sales so employees can receive some compensation from their stock? [23:15] which companies are they? [23:17] I think what's interesting is we're definitely seeing the secondary sale phenomenon that you talked about. And I think Revolut just announced a secondary sale quite recently. [23:27] And we've also seen, you know, there were a few others that also did secondary sales. I think Rippling was one of them. Applied Intuition was another. And I think that these companies are doing secondary sales. What it looks like to me.

[23:39] is that these are some of the stronger companies who are possibly planning to go public in the next time period, whatever that looks like. And, you know, for Revolut and some of these other companies, it makes a lot of sense to give employees, you know, existing and some who've left, but to give them some liquidity now, because I think if you do go public and these employees have been locked up for a very long time [24:09] most of these employees is about six months after going public, and that will impact the stock price [24:15] at that six-month mark and is not good necessarily for those companies. So I think if you're a strong company, as Revolut is, you're growing your revenue, you're profitable, you're looking to go public, and there are lots of these private equity investors who'd like to get their hands on some of that stock in advance of an IPO. It seems like a very good solution to give employees some of that liquidity so that when the company goes public and then when that lock-up period opens up, they've already taken some of that risk off the table [24:45] on how the stock's doing and how they think the company is doing and not sort of be forced to sell at that point. So I think we're going to see more of this, but it's really it's less the sort of M&A targets. I think it's more of the companies that are thinking about going public and would like to, and as I say, are strong and have private equity investors who'd like to purchase some of the stock. [25:08] That's a good point.

[25:09] That's really interesting. So we talked about AI. We talked about the current state of the markets. We talked about M&A. I kind of want to take another macro step and talk about the power laws within VC since you've been covering it for so long. [25:39] of capital has been deployed to only a few number of companies and what are those companies? [25:46] One of the things that is interesting is when you looked at the kind of market growth in 2021, every single stage was up. Like seed was up, early stage was up, late stage was up. But late stage was up the most. And because there were these very large dollars going into these sort of high growth companies, we saw more unicorns than we've ever seen before joining the unicorn board in that year. And so the whole story, even though every single stage went up, which makes sense, [26:16] at a better valuation, you're going to be more inclined to invest. So everything went up, but it was late stage. And then when the market pulled back, it was late stage that came down first, the most dramatically, then early stage. I sort of saw it quarter by quarter, and then seed funding was sort of the last to kind of start pulling back as well. And I just looked at, you know, the top 30 companies specifically just in the US that raised in 2024. And I think what's interesting, and I don't know if late stage has come back, but you know,

[26:46] Q2 late stage was up. These largest rounds was up. But when I looked at 2024, 30% of capital went to the, in the US, the top 30 companies that was raised this year so far. So that's the first half. If you look at 23, that was also high. That was around 28%. And in 2022, that was 12%. [27:05] So you can see that sort of in the last few years, the shift to those kind of larger companies or larger rounds are eating up a higher. And I haven't really thought about why or what's happening because I've been so focused on late stage coming down. But it is interesting to note that. [27:24] In some ways, in this downturn, and we have been hearing this across the board, that round sizes haven't necessarily come down, that people are being more... [27:35] I'm careful about where they place their bets. They're being more concentrated. So they're investing in fewer companies. And sometimes when there are investing, they're not investing less in this market just because companies are going to take longer to get to the next round, possibly, or are going to need more money to show themselves up. And so there has been this trend towards. [27:55] Fewer investments, fewer companies, but in fact, larger rounds. And we, you know, I'm just doing working on analysis where we see rounds come down in 2023 a bit. They're still way up. They're not as high as 21, but they're way above 2020. And now we've seen for the first half of the year. [28:11] Thank you. [28:12] It's sort of come up again. Obviously, it'll come down a little bit as the long tail of fundings get added. The smaller ones get added after the end of the quarter. But we are seeing that pick up again. And so it is interesting, this conversation around how.

[28:26] The industry seems to be coming more... [28:28] more concentrated and possibly in a slower market that makes sense. [28:33] Yeah, and hopefully there is more activity on the later stages. I know some friends that got very bored in their jobs because there isn't much to do. But that's only because there are so many mismatches between multiples and expectations and performance. Based on that and our M&A conversation, there is a large amount of trapped capital. We talked a little bit about secondary investments for employees. [29:00] But where do we go from there? Are you seeing anything on the fund side? I think broadly the market, I haven't done a lot of analysis on the fund side, but broadly in the market, the discussion is that fund size, that there's less. [29:13] funds raised in this market. Obviously, immediately after the slowdown in 2022, there were still some very large funds that were raised. I think that's definitely slowed and it's probably becoming more concentrated as well. There are, you know, broadly what the. [29:27] I think when you speak to venture investors, and you're probably very aware of this as well, is the liquidity concern is huge. And I think that came out in the Carter report that there hasn't been a lot of distribution from funds in recent years. So I think that liquidity question is very, very big for investors at this time. And I don't think they do have funds to invest. I think they've been holding back to invest those funds because of [29:55] the lack of disbursements within the industry. And so I think there's a lot of waiting for the IPO markets to open up. And in talking to anyone, you know, there is the sense, you know, we have more than 1,500 companies on the unicorn board. Obviously, for a lot of those companies, those values would not hold up in this market. But for many of those companies, they've gotten their house in order. They've cut costs insofar as they can. They've gotten into shape in terms of looking at a path to profitability.

[30:26] They've honed their revenues. Some of those companies are growing at quite a great clip, as we saw with Revolut. And so I think there are a whole host of companies that are on the unicorn board today that would be ready to go out, but they don't think the public markets are very receptive. So I think that is a big concern. But there are definitely companies that are in shape. And I know, I don't know if you track the Cloud 100 from Bessemer, [30:55] Thank you. [30:56] 97% of those would reach 100 million in ARR by the end of this year. So that's already a healthy set of companies who are growing and have some significant revenue. [31:08] When did you start the unicorn tracker? [31:12] Oh, goodness, I think they propose. [31:16] You know, we've always been tracking unicorns. I'm trying to think when we launched the unicorn. So we've always been tracking within Crunchbase Pro as a sort of list. And then we decided we needed a sort of definitive place to collect all of those companies. I'm trying to think when Aileen first came up with a story on unicorns, but it was after that. So but it's been a good number of years that we've been tracking, but I'm not sure the exact year. I feel like it would be a 2021 thing because there was just such a swell of unicorns and a rise in them. [31:46] years, maybe it's year over year, like was that the largest increase and have we seen a dramatic fall since then? [31:53] So a significant fall. So I think in that year there was close to –

[31:58] I'm going to try and remember, but it was almost over 700 companies or around 700 companies. And I can check that joined in that year. [32:06] And we're massively, you know, 2022, so I'm looking here at the numbers, [32:10] Yeah, 2021 was 621 that joined. So I slightly overestimated. So over 600 companies that joined in that year. [32:18] And then I think what's interesting, and this is sort of points to the venture markets taking a little time to react, is 2022, that number half, so it was around 300. So that's pretty strong, given that the venture markets have pulled up back significantly for 300 companies in that year to join the board. And a lot of that was focused in the first quarter or the first half of the year. [32:48] to the most recent month was around 13. So that's sort of been the trajectory over the last two years is – [32:54] Single digits or very low double digits. Um [32:58] in a month joining the unicorn board still. But what we do find is that unicorn board keeps growing because not as many companies are exiting the board. So it keeps kind of every month when we track this and do our reporting on the new unicorns, that number slowly kind of keeps going up. [33:15] How do you track the exits? [33:17] I'm just companies that are acquired or go public so companies who leave the board and then also the news announcements about companies that are closing down or are being dehorned and losing you know their unicorn status so.

[33:33] We try to keep track of all of it to keep the board up to date. [33:37] Okay, well, it sounds like, um... [33:39] Investors have gotten a little bit more disciplined in shelling out unicorn status, even in the age of AI. So that seems... [33:48] like [33:48] a positive to me, if anything, discipline within the ecosystem. But who's to say that doesn't change next month or whatever? Yeah, I think it's going to be slow for a while. I think so too. So as we close out, I did want to mention and go into one category that you talked about in the beginning. So when you started out, you tracked female founders. And this has always been a small number. I've been working in VC for like six years now. And [34:17] It's a small number. It just is like female soul founded companies are rare. [34:23] Female founded companies with a male co-founder, that's, it seems a little bit more, you know, [34:31] common. And then since you've paid so much attention to this, where is that going? Has this endured through cycles or are we seeing an uptick? Is it going down? Like, where are we at? Yeah, I think, I mean, I've been in this industry for a long time since the late 90s. And when I first joined the industry, I have to say there were very few women in Ventura. It was like they were standout individual women that you could point to. And similarly, for female founders or

[35:01] were very well known in the industry and kind of stood out, but were these sort of unique [35:06] lone kind of individual. So I think, you know, one thing to be aware of is that over the last 20 years, and certainly over the last decade, and as venture is as grown as an ecosystem, with the whole growth of seed and the many, many more companies that in many ways, you know, and in venture and on the founder side, for me, it's changed quite dramatically, because there were so few, there were hardly any woman, there was certainly a woman working in tech, there were [35:36] So they were powerful women in the industry, but not always in their sort of venture and founder roles. So that's changed quite dramatically, but still the number has changed. [35:46] The numbers are quite – there's a long way to go. So I think to sort of provide context, around 8% of companies that got funded in 2023, so if we look at the last few years, 8% were female-founded, and they raised around 3% of dollars. So a lot of those companies were at the earlier stages because it's a smaller proportion of dollars. And then when you look at female-male co-founded, it's about 14% of deals in 2023. [36:16] This past year, usually that's around... [36:19] 10% to 12% of dollars, again, it skews a little bit more to seed, but a little bit less so because it's more proportional. But this last year was very high because of AI. So we've seen some significant AI companies, OpenAI, Anthropic being among them, that have a female co-founder for OpenAI. Those female co-founders or co-founding team are not with the company anymore. So the dollar amounts to female and male co-founded.

[36:49] 23% to around 23%. But I think broadly what we're speaking is around 15% of dollars in a regular year. [36:57] Around that amount went to companies with at least one female founder, and around 22-23% of deal counts go to a company with a female founder. So those numbers are very different from, if you look back at... [37:12] to more than a decade back, but they've been somewhat consistent since 2015. And I think what's interesting is when people talk to me that when venture went up massively in 2021, the perspective was female founders could lose out and actually – [37:29] That went up as well. Proportionally, they sort of maintained when the market grew. And then when the market pulled back, there was also the sense of female founders are going to lose out. And again, they proportionally maintained. So this isn't. [37:43] massively shifting year over year by any [37:46] percentage points. Sometimes you see [37:49] 0.2 or 0.3 shifts year over year and over a longer period you see a shift and but [37:56] So I guess one, you know... [37:59] Rosie thought is that the numbers haven't, you know, women haven't lost ground. And because the ecosystem is a lot bigger, there are a lot more female founders out there. And I really go to a dinner or an event or I'm in a venture environment where there aren't. [38:16] quite a few prominent women on the VC side and the founder side.

[38:21] Yeah, that's I mean, I guess that's positive news. Hopefully it continues to grow as we see more talent, especially come out of these AI companies, because it's a real thing. As we wrap it up, what are you most excited for this year? [38:51] Thank you. [38:52] certainly in shape to do so. [38:54] Um... [38:55] Yeah, I would say that more than anything else. And I think the whole AI wave is incredibly exciting and the impact it has on tech is going to be incredibly exciting. So it does feel like a completely new journey. You know, we track the mobile wave. [39:11] Coming out of the decline in 2008, there were a lot of companies that were formed in that wave that we use on a daily basis. And so I think it's going to be exciting to see what comes out of this. [39:24] Amazing. Well, it's a great note to end on. Thank you so much for coming on, Janae. [39:28] Thank you, Molly. I appreciate it. This has been great. [39:41] There's no shortage of podcasts and deep dives into the secrets of VC. But the truth is that the world's best venture firms and GPs at their helm still remain an enigma. VC is as much of an art as it is a science.

[39:52] Other shows focus on the now adventure or even the last 10 years. But what separates the most enduring and generation-defining firms is the subject of a podcast called Turpentine BC from the Turpentine Podcast Network. On this season of the show, you'll hear from Ben Horowitz, Alfred Lin, Mahmoud Hamid, and more. Subscribe to Turpentine BC for the rare and revealing conversations that can only be had investor to invest in. [40:14] you