Fire-sale prices for startups. Investors hung out to dry. Founders pulling the rip cord even when they’ve still got cash left in the bank.
The harsh realities facing creator economy startups are getting even harsher, prompting a stampede of founders looking for exits as they struggle to find growth and funding for their businesses. So far this year, there have been 35 completed or planned sales of companies in The Information’s Creator Economy Database—from creator-focused shopping apps to providers of podcast recording software and rights management for musicians. That’s more than double the 16 sold in all of 2022. Eleven of this year’s deals happened in October, the most for any single month this year.
“The reality is that the vast majority of creator economy startups never had traction,” said Sarah Kunst, managing director of early-stage venture firm Cleo Capital. “They will and should consolidate or go out of business.”