SkyDeck wrapped up its latest program this week, and founders who went through the accelerator are now grappling with an increasingly challenging funding environment.
Fifteen startups participated in the program's current Batch 15. Along with three alumni companies, they pitched investors on Tuesday during the accelerator's semi-annual Demo Day.
Around 1,200 people signed up for the hybrid event, about half of whom attended in person at UC Berkeley's campus — a 50% to 60% increase over the past few years since Covid-19 forced the program to go virtual.
Founders and investors are benefiting from a shift back to having more in-person programming and meetings, as well.
SkyDeck has grown its network of mentors and advisers to 600 people. And while the shift toward more virtual work has opened up new opportunities, face-to-face networking and in-person meetings are more crucial than ever, SkyDeck's Executive Director Caroline Winnett told me.
"We have these meet-and-greets in the beginning. It's like seven sessions of speed dating to match the founders to the advisers. And having some of those remotely means that the advisers can join who don't live near Skydeck," Winnett said. "And now we have a more global network. … But you still need the in-person."
Venture capital firms have generally pulled back over the past year, though, particularly at later-stage rounds amid rising interest rates and a broad tech rout that has dragged down private valuations.
Early-stage funding has been less impacted, but founders are still feeling the crunch of market forces.
"They're very realistic and sober," SkyDeck Fund's Managing Partner Chon Tang told me. "They know it's tough out there. They don't have unrealistic expectations, which is a good thing."
Founders I talked to during SkyDeck's Demo Day said they had already taken meetings with dozens of investors about new funding rounds. Many of those conversations are ongoing, and the total number of investors they meet with will likely continue to grow.
"We're cautiously optimistic, because we're solving a real problem," Alvva co-founder Sergio Torres told me.
Alvva is building financial and legal tools to help people navigate and pay for U.S. immigration-related documents and applications.
"It's all a matter of finding the right people," Torres said, even if it takes getting "connected to 150 investors. I think eventually we will. It is a painful process, right? But we have to go through it."
Enthusiasm for starting new companies and innovating continues to reverberate globally, nonetheless. Last year, SkyDeck launched a satellite accelerator and fund based out of Milan to capture startups innovating across Europe.
Compared with a decade ago, SkyDeck is also increasingly attracting, and selecting, more founders from around the world who bring deep expertise in specific industries.
"This batch, they have strong businesses and they're solid. Even if they're early, they have a very good strategy and the founders are locked in. They're not distracted. They're not wandering around. So, we're feeling very good about them," Winnet said. "It's tough out there, no question. And they know that."
For its next cohort, Batch 16, SkyDeck received 1,800 applications, a record number.
And the applications "are strong," Winnett said. They're not seeing a lot of "swipe left" type of apps and business ideas.
And the quality of founders going through SkyDeck is increasing, even as fads come and go.
"Every few years, there's usually a new fad that venture wants to get excited about," Tang said. "But what really doesn't change is just being focused on customers. And I do think that the quality of the founders that we get is just consistently getting better. Partly because we're more selective. Partly because there's more institutional knowledge around about how to build a startup."
Startups that get accepted into SkyDeck's accelerator program receive a $200,000 investment from the fund.
