How startups are dealing with the hardest fundraising climate in more than a decade

Cloud stocks were already down 40% from their 2021 highs when Cube CEO Christina Ross launched fundraising efforts for her financial planning software business in February. They have a lot more to drop in the coming months. When Cube launched its $30 million Series B round in mid-June, the broader market was about to have its worst first quarter in 50 years, led by a drop in high-growth tech equities, which had been the top outperformers in the Nasdaq Composite’s ascension to a record in November.

The private funding market tends to lag behind public stocks, providing venture investors time to modify their exit price expectations. However, the transition is now complete.

The IPO market’s suspension has effectively halted pre-IPO rounds, and the sharp decrease of software multiples has stymied private deal flows. Companies are doing everything they can to avoid the dreaded down round, which is funding that is worth less than the preceding round. Ross, who started Cube in 2018, anticipated that any valuation today would fall far short of the bubbly days of 2020 and 2021. However, she was also aware that many of those high-priced deals had produced an albatross for the receivers, who now face a financial burden and gloomy reality.

Read more here.


Founder of Zella Life Remy Meraz joins Google for Startups

Zella Life founder and Plug In member Remy Meraz announced earlier this week her company was selected to join the first cohort of the Google for Startups LatinX Founders Fund, a $5 million initiative designed for LatinX founders who are building great companies yet are often locked out of access to the funding critical to their success.

“I applied to the Google for Startup Latino Founders Fund because Black and Latinx women founders received less than half a percent of total VC investment in 2020, and I’m grateful to Google Startups for recognizing this and taking action. The Google for Startup Latino Founders Fund is enabling us to increase access to professional and personal development coaching for the BIPOC community,” said Remy Meraz, co-founder and CEO of Zella Life. 

Zella Life is an AI-driven coaching platform for individuals and corporate teams that are changing the future of work for professionals of color. Remy joined Plug In’s first Tech Accelerator cohort in 2020.