It’s confusing.
On the other hand, as Patrick Mathieson notes, there has been a “retreat to quality”. For the Newbies (VCs that dabbled in enterprise), their portfolios are loaded up with B+ companies that aren’t failing, but likely will never move the needle. They were seduced by traction. And they are still nursing those wounds.
For the Old Timers, many are still digesting rounds they way overpaid for in ’15 in particular. And there is definitely “portfolio triage” and headaches around high-burn, medium-growth portfolio companies these days. That’s very distracting.
But …
The leading B2B VCs have >all< raised new funds in the past 12 months. And often larger funds. And usually, faster than ever before (50% faster).
Combine all this, and I’d say the Top Enterprise/SaaS/VCs have about 1.5–2x as much to invest over the coming 24 months as the past 24 months. And I see it. They are hunting. Aggressively now. They were even hunting aggressively in February, the big dip in the market. They are sitting in lobbies, waiting to meet the best CEOs. Introducing them to their best contacts, hoping to win the next round.
Because the best SaaS VCs are feeling pretty good about their hands. Pretty good about Twilio. About Slack. About Intercom. About lots of them.
This is the best of times for SaaS. Not the highest valuations. That was 1H’15. But the best, fastest, highest quality growth.
So just as many deals are going to get done. One way or another.
It may be a while before we get back to the valuations and risk-taking we saw through 1H’15, however. But just as many deals are gonna get done by the top, “old timer” SaaS VCs as ever. Probably more, with bigger, faster, new funds.
All my SaaS companies that have raised in ’16 have gotten a round done in a week, from great VCs. You just need the full package. Folks took too much risk in ‘15.
