2025 will likely be another brutal year of failed startups, data suggests

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2025 will likely be another brutal year of failed startups, data suggests - TechCrunch

Quick Summary:

Dori Yona, CEO and co-founder of SimpleClosure, a startup that aims to automate the shutdown process, believes that in 2021, we saw a large number of startups receiving seed funding “probably before they were ready.

Most startups tend to shut down when the coffers are completely dry, though some see the writing on the wall early enough to give a bit back to their investors.“The majority of startups (60%) that fail don’t have enough capital left to return to investors,” Yona said.“Founders that do plan on returning funds have an average $630,000 of investments left — about 10% of total capital raised, on average.

There are likely other shutdowns that wouldn’t be accounted for through Carta, estimates Peter Walker, Carta’s head of insights.“Yes, shutdowns increased from 2023 to 2024 in every stage.