May 9, 2024

Rise of the Phoenix: Startups Flourish Amidst Big Tech Layoffs

Nic Szerman lost his job at Meta Platforms in November of 2022, just two months after joining full-time, and became one of the victims of a 13% reduction of its workforce due to the decline in the advertising market. However, instead of feeling defeated, Szerman used this opportunity to focus on his own company, Nulink, a blockchain-based payment company, and even sent pitches to startup accelerator Y Combinator and Andreessen Horowitz’s cryptocurrency fund. Szerman is part of a trend of aspiring entrepreneurs who have been able to turn job losses in Silicon Valley, caused by companies such as Meta, Microsoft, Twitter, and Snap laying off over 150,000 staff according to Layoff.fyi, into opportunities for starting their own businesses. Despite overall venture capital financing falling 33% globally to about $483 billion in 2022, early-stage funding remained strong with $37.4 billion raised in angel or seed rounds, similar to the record levels seen in 2021. Some investors have even compared the 2022 downturn to the dotcom crash of the early 2000s, which resulted in the creation of successful companies like Facebook and YouTube.

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