2022 was a whirlwind. The worsening market downturn certainly weighed on everyone’s mind and to navigate these times, we doubled down on what we know best - our two flywheels of community and corporate engagement. These allow us to dig up the most pressing pain points for buyers and then invest in and play matchmaker with startups solving for them.

As 2023 approaches, we wanted to take a moment to zoom out and recap what transpired over the past year in our enterprise software ecosystem in NYC and beyond:

NYC IRL Events Were Back & Better Than Ever

Part of what has always made NYC special is its density of talent from a variety of backgrounds, and how easy it is to connect with others just a subway ride away. With NYC back in action this year, we dove back into dinners, happy hours, and large-scale events, including our annual developer happy hour, AMAs, #Womenterprise breakfasts, dinners and happy hours, infrastructure and product dinners, our newly launched and highly tactical masterclass series (see here and here), and more across founders, operators, and more.

We also experimented with new event formats. One of our newfound favorite events of the year was our LFG: NYC Enterprise Operators Retreat. We gathered 125+ enterprise operators across various functional areas from Cockroach Labs, Spring Health, Attentive, BigID, AlphaSense, and other top scale-up NYC enterprise companies. The magic of the day was that we ventured out to Bear Mountain State Park, giving everyone a break from the day-to-day grind of the city and a chance to meet fellow senior operators to swap notes on best practices working today.
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Highlights from our LFG: NYC Enterprise Operators Retreat at Bear Mountain - See more here

We also celebrated the 10 year anniversary of our NY Enterprise Tech Meetup and there was no better way to celebrate than returning meetups back in-person in the Fall. We brought the fun of learning about new tech and meeting new people over food and drinks back, and the feedback was incredible with over 1,000 RSVPs for each event (AWS Loft’s bouncer had to do crowd control for the long lines outside and passersby must’ve thought we were at hot NYC club). In September we talked PLG with powerhouse GTM leaders from MongoDB, Snyk, and Elementl and in November we took it back to our enterprise sales roots dissecting how the former SVP of Outreach scaled the company from $0 to over $200M ARR.

Customer Demand Is Shifting Back to Sticky Fortune 500 Contracts

Over the past couple of years, the startup zeitgeist was all about product-led growth and startups selling into other startups and large tech companies. However, these companies are suffering the consequences of two years of over-spending. Between cost cutting and layoffs, there will be significant churn from this customer group as well as headwinds selling into them in the near future. As a result, go-to-market is going to be focused on two main areas as we expect the pendulum to swing back towards favoring large and sticky Fortune 500 contracts.

• Minimizing churn to retain current customers. Data-driven and precise customer success has never been more important and customer success platforms like Catalyst are already making it happen. 
• Building alongside a product-led sales motion. New tools are emerging to help usher in more effective PLG sales layers. For example, Pace helps enable companies with existing product-led motions to move upmarket in a cost efficient manner and Octane helps companies create unified billing plans and automate them for self-serve customers.

While selling into the Fortune 500 is tough, these giants need to work with enterprise startups more than ever given the need to drive new capabilities and efficiencies with less budget.

We’ve kept our drumbeat of what’s happening in the corporate world by connecting with new and old friends from our Fortune 500 network at dinners, on sailboats, at Mets games, and more.
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Sailing on the Hudson and CISO Dinner

We also put together an entire library of enterprise playbooks (47 and counting) to help our portfolio and the broader enterprise software community navigate the most challenging aspects of Sales, Marketing, Finance, and more. In a time when every day of runway matters, avoiding mistakes and optimizing tactics matters more than ever.

Funding Activity Came Back Down To Earth

While 2021 saw record shattering funding activity ($16.7B raised across 237 deals) as many firms over-deployed capital, early 2022 stats show we’re back at pre-pandemic levels ($3.2B was raised across 90 deals in 1H22). As valuations plummeted, VCs who over deployed and overpaid in 2021 spent a lot of the year digging themselves out of a hole. 

Meanwhile, we’re proud to say that we kept our investment pacing consistent during the boom of 2021 and the scarier times of 2022, and we plan to keep that steady drumbeat come 2023. We’ve been consistent in our strategy since launching almost 10 years ago, and we know what we love and how we can best support founders.

If you’re thinking about launching a startup or have already taken the leap, we’re happy to connect with you to share feedback on best GTM wedges and possible early use cases, and plug you into our enterprise community where helpful. We’re actively deploying out of our Fund 3 and we’re always looking to meet talented folks!