Like fintech As the venture market goes, so goes the venture market itself. why? Because fintech investment has made up about one-fifth of every venture dollar in history — at least in recent years. And both fintech investments and venture capital are dealing with a new, more conservative reality after a bit of success last year.
For fintech startups, the downturn is real, and many startups – we learned during a recent fintech investor survey – are looking to avoid de-novo rounds that involve fresh valuation (no one wants to raise a low round!). Therefore, extension rounds are an attractive option for many founders.
But as TechCrunch reports, while extension rounds are popular beyond fintech today, more startups are hunting for the round type than there are checks. So to better understand the market for fintech extension rounds today, we have one more answer from a group of fintech venture investors we surveyed. Here is the question we asked:
How popular are extension rounds? Compared to 2021 and 2020, are you seeing more companies choosing to add extensions rather than new rounds?
Eight investors answered: Paul Stamas General Atlantic, Alda Leu Dennis initial capital, Michael Gilroy of Coatue, Justin Overdorf Lightspeed Venture Partners, Addie Lerner Avid Ventures, David Jagan F-Prime Capital, Nik Milanović fintech fund, Jay Ganatra Infinity Ventures. (Their answers have been edited slightly for clarity.)