TLDR:
- Faltering start-ups are raising cash in funding rounds that wipe out existing investors’ prospects.
- New backers are receiving high returns akin to payday lending as these companies struggle to survive.
Faltering start-ups that raised significant funding during the pandemic are now facing dire circumstances, with new funding rounds severely impacting existing investors. These struggling companies are fighting to survive until they can achieve profitability or a sale, with new backers reaping returns similar to payday lending. The high valuations that were once achievable during the pandemic are no longer holding up, leaving investors in a difficult position as they navigate the challenging landscape of the start-up world.
