> next year as the downturn ends and the upswing begins
Who says the downturn ends next year?
VCs act like it's all 2008: someone will come and bail them out. Yet, we are literally one Powerpoint away from a multi-year dumpster fire.
Who says the downturn ends next year?
VCs act like it's all 2008: someone will come and bail them out. Yet, we are literally one Powerpoint away from a multi-year dumpster fire.
If “the economy” believes there will be a recession, there almost certainly will be one. Even if it wasn’t going to happen by itself.
VCs dumping money into the “bottom point” of the market will also stimulate the economy a lot, leading to a recovery.
There have been beliefs there will be a recession from the end of the 2008 recession to date. There has been beliefs that things are great and there will never ever ever be a recession ever again.
People who believe a recession is coming are like broken clocks, many of whom have prediced 45 out of the last 3 recessions.
OP's point as I read it is that once those beliefs hit a critical mass amongst the general population they tend to come true via self fulfilling prophecy. Correlation/causation aside - the point is not "if my uncle thinks a recession is coming, there is", it's "if 100mm American adults think a recession is coming, there is"
These VC funds made a lot of money last year, and if they can't make up a reason to re-invest it they have to return it to the next layer up, who face the same decision.
They are probably getting paid on assets under management, so their incentive is to support current valuations by swapping funding rounds at good valuations with other funds, and generally putting the money away before things get any worse.
That's just the premise of the article base on a historical observation that recessions last around 15 months...this was explained clearly.
If your personal outlook is that we're walking into a multi-year dumpster fire then the advice in the article should be adjusted accordingly.