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From SVB And SBF To AI And IPOs, There Was A Lot Of Action (And Acronyms) In 2023

Dec 27, 2023 - news.crunchbase.com
The article provides a review of the venture capital industry in 2023, highlighting key events and trends. The collapse of crypto exchange FTX and the subsequent conviction of its founder, Sam Bankman-Fried, on fraud charges was a major story. The AI sector saw significant investment, with Microsoft's $10 billion investment in OpenAI being a standout deal. However, the industry was rocked by the collapse of Silicon Valley Bank and First Republic Bank, which had significant relationships with venture-backed companies and VC firms. The tech sector also saw around 190,000 layoffs, with both large and small companies affected.

Despite these challenges, there were some positive signs, with the tech IPO market reopening after nearly two years. Arm Holdings and Instacart led the way, raising hopes for increased IPO activity in 2024. However, the year ended with drama at OpenAI, with co-founder Sam Altman briefly ousted as CEO before being reinstated. The article suggests that the venture capital industry can expect more of the same in the coming year, with a mix of successes, failures, and drama.

Key takeaways:

  • The year 2023 saw significant events in the venture-backed startup world, including the collapse of crypto exchange FTX, a banking crisis, and the firing saga of OpenAI's CEO.
  • Despite the crypto contagion, crypto prices steadily rose throughout the year, but VC optimism was not as high and crypto and Web3 funding declined significantly.
  • The AI sector saw significant investment, with Microsoft investing a reported $10 billion into AI goliath OpenAI, and numerous AI startups raising billions of dollars.
  • The collapse of Silicon Valley Bank and First Republic Bank, two major banks for VC-backed startups, has likely changed the way startups bank and secure venture debt.
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