Nicknamed Silicon Valley kingmaker, investment firm Y Combinator is warning startups that it may be winter for businesses soon as the trend is reversing on what has been a decade long bull run for disruptors.
“If your plan is to raise money in the next 6-12 months, you might be raising at the peak of the downturn. Remember that your chances of success are extremely low even if your company is doing well. We recommend you change your plan,” the firm said in the letter, titled “Economic Downturn.”
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Y Combinator (YC) backs hunders of startups yearly and has recently chopped down the value for giants such as Shopify and Netflix as it warns early-stage startups universe will also feel the heat.
YC raised the red flag on funding as it advised founders that-:
"Irrespective of your ability to fundraise, it’s your responsibility to ensure your company will survive if you cannot raise money for the next 24 months."
Globally and in India funding for startups has slowed and firing amongst some of the larger names has been brutal as revenue slowdown is adding pressure to books and cashflow.
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