For startups and VCs, it’s an era of myths and manias

Centaurs, founders’ mental health, and crypto mania are just some of the startup and investor highlights from the 2023 event in Lisbon. Here’s what some of our speakers had to say about them. 

Web Summit 2023 brought together speakers from across the globe to discuss not just tech, but many of the things impacting society and the economy. 

It has been a challenging economic period for both startups and investors. Not only does this mean the potential decline of the concept of unicorns, but also questions must be raised about the impact on founders mental health.      

Here are some of the startup and investor highlights at Web Summit 2023, from speakers including the Jaidev Janardana, CEO at Zopa, Vera Baker, venture partner with Unconventional Ventures. and actor and crypto sceptic Ben McKenzie.

Are centaurs the new unicorns?

Unicorns are rare, but are they becoming extinct? It’s a perennial question for the tech world. 

According to Jaidev Janardana, CEO at Zopa, “the bubble is over, and that probably is a good thing, because hopefully investors will be more discerning”. With less favourable economic conditions, the focus for investment is on unit economics and sales – not long runways and heavy cash-burning.

While there may be fewer unicorns in the future, the focus now is on ‘centaurs’. These are startups that generate more than US$100 million in revenue annually, and have a clearly demonstrated path to profitability.

Fiat Ventures general partner Drew Glover does not believe there’s any difference between these mythical beasts: “I believe if you’re a centaur, you’re a unicorn. If you do US$100 million in revenue, I, as an investor, am very happy to call you a unicorn.”

Drew believes these are just “momentum words” that can be applied to any hotshot startup – and, while buzz words will come and go, successful startups will continue to attract investment. For founders, though, their term sheets may be a little different.

Founders’ mental health should be a priority for VCs

The current downturn in funding has placed a strain on startup founders. Amid this turbulent period, the VC community is realising the need to support founder mental health.

“VC is so much about ‘go fast and get shit done’, as opposed to mindfulness and meditation. But I do think that investors are much more mindful about what’s happening with founders today,” said Vera Baker, venture partner with Unconventional Ventures.

Explaining that some funds offer in-house therapy and mental health subsidies, Vera emphasised that it’s up to investors to ensure that founders can access services.

Eileen Burbidge, director of Fertifa – a startup offering reproductive health benefits for employers – agreed, arguing that investors have a “duty of care” for founders’ wellbeing.

The director reflected on Monzo founder Tom Blomfield’s resignation due to mental health issues – something the founder has been outspoken about – calling it a “failing on our part, and the board, to not recognise that with him sooner”.

“As investor shareholders, if we’re not looking after founders’ wellbeing … then we’re not going to see them bring their best selves to work,” added Eileen.

Crypto is a ‘study in manias’

Actor Ben McKenzie has gone from being one of TV’s most prominent stars to one of crypto’s biggest sceptics. Ben’s stinging criticism of FTX and Sam Bankman-Fried has recently been vindicated by the US judicial system.

“Crypto is the newest iteration of multi-level marketing in many ways,” said Ben, “and studies show that 99 percent of people lose in multi-level marketing.”

Crypto went from the latest financial innovation to the latest financial crisis in just a few years, “speedrunning the last half a millennium of financial mistakes”. However, while highly critical of crypto in its current form, the OC star “[is not] sceptical of the problems crypto purports to address”. 

And while crypto has firmly positioned itself in the ‘bust’ category, the boom in AI leaves Ben far more optimistic, with the suggestion that the technology is much more “substantive”, and that “the ‘doomerism’ around AI can become overwrought”.

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