Blogs -Silicon Valley is Losing its Entrepreneurial Spirit

Silicon Valley is Losing its Entrepreneurial Spirit

January 09, 2020


Beth Kindig

Lead Tech Analyst

This past week, I wrote about how Silicon Valley is losing some of its entrepreneurial spirit as venture capitalists shifted their attention to later stage deals with higher valuations. In the analysis, I pointed out that 2019 was the most lucrative year for exits in more than a decade, with $200 billion in exits generated from venture-backed IPOs.

For context, I went back to the golden years of Silicon Valley – 2006 to 2014. During this period, venture capital that was invested in deals below $5 million grew by 290%.

However, things changed in 2015, when early stage deals from below $1 million to under $100 million began to decline at a rate of 20% to 36% per year. Early stage software companies suffered most from the reallocation during this period, while early stage deals declined from 388 in 2018 to around 279 in 2019.

So how did this happen?

I identified two culprits behind the trend – Silicon Valley’s declining entrepreneurial culture and the increasing attractiveness of late stage investments.

Startup pitches and dynamic innovation have been replaced by a relatively closed circle of investors who are only targeting high valuations. In fact, we are seeing an aggregate all-time high for 180 private companies with $1 billion-plus valuations, and they have undermined the attractiveness of seed and Series A round companies.

Moreover, the IPO window is shifting from a range of six to eight years to ten to twelve years, which drove several startups to go public at valuations of over $10 billion this year. Consequently, this has made late stage investments more attractive due to their longer duration and higher valuations. The downside is that it has suppressed early stage investments (defined as deals below $5 million), which only further hampered Silicon Valley’s entrepreneurial culture.

Exciting early stage entrepreneurial stories have become rarer over the past few years, and many of the start-up tech events that I go to have either a noticeable lull or have moved overseas. The sad reality is that Silicon Valley’s entrepreneurial culture has faded, and entrepreneurs have a better chance at attracting capital from strangers on Kickstarter than from Silicon Valley angels and VCs.

Read the full article in MarketWatch here.

Image by Patrick Nouhailler

Gains of up to 403% from our Free Newsletter.

Here are sample stock gains from the I/O Fund’s newsletter --- produced weekly and all for free!

+344% on Nvidia

+403% on Bitcoin

+218% on Roku

*as of March 15, 2022

Our newsletter provides an edge in the world’s most valuable industry – technology. Due to the enormous gains from this particular industry, we think it’s essential that every stock investor have a credible source who specializes in tech. Subscribe for Free Weekly Analysis on the Best Tech Stocks.

If you are a more serious investor, we have a premium service that offers lower entries and real-time trade alerts. Sample returns on the premium site include 324% on Zoom, 601% on Nvidia, 445% on Bitcoin, and 4-digits on an alt-coin. The I/O Fund is audited annually to prove it’s one of the best performing Funds on the market with returns that beat Wall Street funds. 


More To Explore


Nvidia's Fiscal Q3 Earnings Preview: The Pressure Is On

Nvidia’s Fiscal Q3 Earnings Preview: The Pressure Is On

Nvidia has surged this year with 241% gains YTD, which has more than doubled the returns of the FAANGs. This is no small feat considering it’s widely understood Big Tech is holding up the broader mark

November 27, 2023
Apple Building

Apple’s Services Growth Flywheel Continues To Strengthen

Apple’s Services segment was one of the brightest spots in a relatively in-line earnings report at the beginning of November, topping an $85 billion run rate as growth jumped back to the high double-d

November 21, 2023
Tesla Sells 33% Of Vehicles Below Average Cost, BYD Pulls Ahead

Tesla Sells 33% Of Vehicles Below Average Cost, BYD Pulls Ahead

BYD more than doubled Tesla’s China sales in October as Tesla’s sales slipped on a month-over-month basis, while NEV startups showed strong sales numbers across the board. China’s new energy vehicle (

November 14, 2023
Solar Panels

Solar Stocks Still Searching For A Bottom

Solar is arguably one of the market’s most sold-off industries at the moment, with the Invesco Solar ETF falling more than 42% YTD as the industry struggles to find growth in a high-rate environment.

November 07, 2023
Five Stocks (Not Seven) Can Lead to New Highs

Five Stocks (Not Seven) Can Lead to New Highs

The majority of other sectors are confirming a continuation of the 2022 bear market, meanwhile, a handful of big tech names, with outsized weighting in the major indexes, suggest that they want to go

October 27, 2023
Big Tech Stocks: Q3 Earnings Preview

Big Tech Stocks: Q3 Earnings Preview

Earnings season has officially kicked off, with Big Tech headlining a busy week next week: Microsoft and Google report on Tuesday, followed by Meta on Wednesday, and Amazon on Thursday. Big Tech stock

October 22, 2023
Apple Building

AI Could Be Apple’s Next Chapter

After Nvidia added $750 billion in value this year on the backs of surging AI chip demand, investors are quickly searching for the next trillion-dollar AI winner. AI is the best investment opportunity

October 18, 2023
AI is the Best Investment Opportunity of our Lifetime: Video Interview

AI is the Best Investment Opportunity of our Lifetime: Video Interview

Real Vision invited Beth Kindig back for a candid interview with Raoul Pal for a one-hour discussion on how to position for AI. As discussed in the interview, the reason that AI will be the best inves

October 06, 2023
The Next Market AI Will Disrupt Is Cybersecurity

The Next Market AI Will Disrupt Is Cybersecurity

Cybersecurity is one of the highest costs that enterprises face at 12% of IT budgets on average, and this cost is rapidly rising. While a company can lay off staff or reduce marketing and R&D expenses

October 04, 2023
Nvidia Was Up 235% In 2023, Don't Expect It To Continue

Nvidia Was Up 235% In 2023, Don’t Expect It To Continue

We’ve had unwavering conviction in Nvidia’s AI story since November of 2018. In fact, it was our leading position going into 2023 and our AI allocation of 45% exceeded Stanley Druckenmiller at 29%, me

September 26, 2023

Sign up for Analysis on
the Best Tech Stocks
The I/O Fund specializes in tech growth stocks and offers in-depth research for Premium Members. Investors get access to a transparent portfolio of 30 positions, a private forum, webinars, and real-time trade notifications. Sign up for Premium.

We are on social networks

Copyright © 2010 - 2023
Get Free Weekly Analysis on the Best Tech Stocks