The VC Bubble Bursts: A Looming Winter?

An analysis based on SEC Form D filings reveals an impending VC bubble burst. By tracking the number of Form Ds containing phrases like "Fund I", "Fund II", etc., the author shows that VC fund raising peaked in Q3 2022 before sharply declining. This is linked to the surge in VC funds during low-interest rate periods and the rise of "SPV-as-a-service" companies. The author predicts a significant decrease in available VC funding, driven by the typical 10-year lifespan of funds and a 2-4 year deployment period, now passing its peak. This coincides with the AI investment boom, leading to inflated valuations. The author concludes that future funding will drastically decrease, valuations will fall, many companies will struggle, and the AI hype cycle will cool.