If you’re reading this story, chances are you unplugged for much of the summer. Maybe you escaped for a weeks-long vacation, took trips with your family or worked from a more remote location than the typical Boston office.
But meanwhile, news about Boston startups making deals, raising funds and launching new products continued, so we put together a roundup to help you kick off the post Labor Day season firmly grounded in what's been happening.
First, let’s take a look at some major trends across the Boston ecosystem.
Funding slowed down
As summer approached, there were signs that venture capitalists were becoming less willing to part with funding. Fears of an economic recession grew and venture capitalists told BostInno that they expected wildly high valuations to drop and capital to become harder to access.
As June came to a close, those concerns were confirmed. VC funding to Massachusetts companies fell 30% in the first half of 2022 compared to the same time period last year.
The startup community saw a drop in funding this summer, but the numbers may be leveling off in recent weeks. By our count, Boston-area startups raised $954.1 million in August. That’s about the same amount of funding that startups raised in July. In June, the state saw startups bring in $2.7 billion in funding.
Also worth highlighting is that VC dollars going to Black and Latinx-run startups in Massachusetts stayed relatively consistent in the first half of 2022. That means Black and Latinx founders got a slightly larger slice of the VC-funding pie — although these companies are still only getting a minuscule share of funding in the state.
Layoffs are up
The tech layoffs that we saw in the spring started to pick up over the summer.
Job cuts were reported at smaller startups like Boston-based Hydrow Inc., a fitness technology company; cybersecurity company Snyk; and Tufin Software Technologies Ltd., an Israeli-Boston security company. The companies mostly cited economic headwinds and cost-cutting measures as the reasons behind the layoffs.
The cuts extended to larger tech companies as well. Wayfair cut around 870 jobs in order to “realign investment priorities,” and DataRobot Inc., which has been embroiled in internal turmoil this year, said it needed to make additional layoffs after previously announcing a 7% reduction in its 1,400-person workforce. Check out a full list of the Massachusetts tech firms cutting jobs in 2022.
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Other news that impacts startups
- The Orange Line shutdown was a major headache for people commuting into Boston this summer. And it’s not over until Sept. 19. The shutdown is also expected to impact entrepreneurs in already-underserved communities like Roxbury, Hyde Park and Jamaica Plain.
- CEOs at Drift Inc. and Motif FoodWorks stepped down. The alternative meat company’s chief technology officer took the wheel from its exiting CEO while Drift brought in a marketing technology and consumer data leader.
- Founders are getting younger and younger. This summer, BostInno wrote about two high schoolers who run their own companies. Both recently launched new products, including an investing web app and a marketplace for cloud computing services.
- Boston TechJam is back! The event will return this summer after a two-year break due to the pandemic. And, for the first time in its eight-year history, it’s free to attend.
- Cambridge had its own ‘hacker house’ for biotech entrepreneurs and scientists ages 19-22 this summer. Founder Subaita Rahman said she hoped the combination of in-person meetings and each person’s unique skill set would create moments of knowledge sharing and serendipitous discovery.
- Techstars Boston was back with its biggest in-person event since the pandemic began. The Demo Day brought together 12 startups from the U.S., Canada and Australia who took part in Techstars Boston’s accelerator. Techstars Boston also announced the launch of a crypto accelerator in collaboration with Boston-based blockchain company Algorand.
