When Russia invaded Ukraine in February, causing global economic disruption on top of already ballooning inflation and interest rates, startups were hit hard. Stockholders of tech startups began dumping their stock and the share price of billion dollar startups was slashed between 22 percent and 44 percent.
In response, tech startups have had to cut back on spending through layoffs and cost-cutting techniques. According to Layoffs.fyi, in May of 2021 only 25 tech companies had announced layoffs or shutdown, compared to 55 companies in May 2022. Online healthcare provider Halcyon Health closed its doors in April 2022 and Uber recently announced it is cutting down on hiring and marketing in an effort to focus on profitability.
“Everything that has been true in the last two years is suddenly not true,” Mathias Schilling, a venture capitalist at Headline, told the Times. “Growth at any price is just not enough anymore.”
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