Dragonfly Capital internal letter: the priority is survival

Here’s a letter we sent to our portfolio company founders and partners this morning. We thought it might be useful to a wider audience, so we posted it here to share with you as well.

Dragonfly Capital internal letter: the priority is survival

I hope you’re staying safe and sane in this volatile market situation. You and your family and friends may have been in close contact with the crypto market, and I hope you put your well-being and health above all else.

Overall, macro conditions have deteriorated for both crypto and growth assets. We know that you are a long-term investor like us, but you must assess current market conditions. In a market like this, the priority is: survive, and make sure you and your team survive until the market is ready for what you’re building. Every bear market brings difficulties and challenges, but those who can weather the storm will reap the fruits of the next boom and create teams and products that endure.

If you’re in the process of expanding, stop as soon as possible and retain the talent you need to get through this downturn. If you’ve expanded recently, now is the time to focus on what’s important and cut back, if you’ve overhired, both in product direction and people, focus your resources on key people and products and drop others . “Spotlight” is the name of the game. The history of tech is full of teams who came up with the right idea at the wrong time and failed to see their vision come to fruition. I don’t want to see this happen to any of you.

I’m not saying this to be alarmist – you shouldn’t be afraid at this point, but take it seriously and with aplomb. The entire industry has just changed, and you should recalibrate your assessment of the current situation. Don’t rely on old assumptions. We can see a huge change in the way Crypto works.

Here’s what we expect to happen:

  • Capital markets will slow down. At a time when investors are beginning to digest new price levels, many deals won’t happen.
  • There will be a huge influx of talent into the market in the next 3 months. The bargaining power between employees and enterprises will become normal.
  • There will be strong regulatory calls. Supervision will become more and more strict, and more and more innovative products will go overseas.
  • Markets are less speculative during this time, especially if retail investors are no longer making big-money deals. Many narratives will be reset, and old narratives will no longer be available.

Each of you will need to absorb this content in a different way. Your team needs to see the confidence and direction you convey. Knowing you’re okay, they’ll be okay too.

If you need help, or just want to talk, we’re always here for you, whether things get better or worse. Working with you because we believe in the industry and because we believe in you and look forward to continuing to be your partner for years to come.

– Tom, Haseeb and the Dragonfly team

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/dragonfly-capital-internal-letter-the-priority-is-survival/
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