There aren’t enough great deals for the 300–500 new micro funds, for sure.
And the rapid expansion in valuations makes it even harder again. Deals at 2x-3x the price of a few years back makes it even harder for small funds to make money.
And yet … these are the Best of Times in SaaS.
So the best of the best will make a lot of money:
And since absolute valuations and public and private unicorns are at an all time high, it’s good hunting.
But it’s difficult to believe there are 10x-20x more truly great start-ups being founded a year than a few years back. If there are, we need all these funds. But if there aren’t … there will be a culling. Eventually.