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January Venture’s 2023 Early Stage Founder Sentiment Report
Insights into the 2023 report from Jen Neundorfer, January Ventures's managing partner
Jackson Fordyce
October 23, 2023
Jen Neundorfer, co-founder and managing partner, January Ventures
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The Story: On Thursday, January Ventures released its 5th annual Early Stage Founder Sentiment Report. The report surveyed over 400 founders across multiple industries, locations, and backgrounds to gauge the temperature of founders in 2023.
Here are some highlights from the report.
The percentage of founders who feel more optimistic about their ability to raise capital is at a five-year high with a 32% increase from last year.
However, while overall founder sentiment has increased, female founder confidence is at a five-year low with only 30% of female founders reporting they are optimistic about their chance to raise capital.
Only 4% of respondents said a layoff contributed to them founding a company.
85% of founders reported that their startups have less than 12 months of cash runway left.
To combat short runways, founders are hiring less, cutting spend on software, and reducing staff count. And they are finding raising difficult. In fact, 39% of them have either paused their raise or responded that they are having troubles with raising capital.
The Expert: Jen Neundorfer, co-founder and managing partner at January Ventures, says the most disappointing finding in the report is the response female founders gave to the question about optimism for receiving funding.
“I think this speaks to the fact that despite a lot of efforts in the venture industry to promote female founders… a lot of that effort has really been lip service.”
The report also highlights how few workers who were laid off have started their own companies. It reads: “More than 93,000 tech workers were laid off in 2022, and there were hopes a startup boom would follow. Yet, only 4% of respondents said that a layoff from a full-time job contributed to them founding a company.”
The billow of new talented entrepreneurs expected after mass tech layoffs has not arrived yet, which is surprising to Neundorfer. “The prevailing sentiment was that all of the people that were laid off were gonna go and start a company and I think the reality is that some of those people felt pretty risk averse after being laid off,” said Neundorfer. “That said, I think it’s really too early to tell.”
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