Startups lose billions of dollars in VC funding every year, especially when it comes to new industries like electric vehicles. But there’s good news for founders who find themselves in a tough spot: you can still succeed by “recycling” your venture.
Amazon and Ford
Like many auto manufacturers, Rivian raised its prices in response to inflation and supply shortages, then backtracked after customers began canceling existing pre-orders.
Wall Street analysts
Every year, according to güil mobility venture’s own research, around $35 billion in seed and up to $84 billion in series-A venture funding is lost in seed stage companies. This amounts to three out of every four dollars invested at these stages. “Ran out of money,” “lost focus,” “got outcompeted,” “had poor marketing,” “ignored customers,” and “unsuccessful geographical expansion” are just a few reasons why startups don’t succeed.
Some recent examples include
In many cases, “recycling” a venture raises the odds of success. According to a
Recently, güil Mobility Ventures announced an equity-free zero-cost program for international startups looking to reinvent and “reassemble” on the LatAm emerging markets. “Recycled ventures” is part of the company’s long-term vision: by giving stagnant startups a second chance, they also help VCs, who fund them, reduce net losses.
With güil’s support, founders can either find the expertise they need to transform their startup, or successfully exit with “cash in hand” and let an external team “recycle,” relaunch, and rebuild their venture from the ground up. Güil has plenty of experience with building successful businesses. It’s the driving force behind Awto, the largest Latin American car-sharing startup; EVSY, the "waze" of electric vehicle owners; 2Bak, a fast-paced reverse logistics platform; and Kupos, a growing player in the multi-modal mobility space.
The company was founded in 2019 by the Kaufmann group, one of South America’s largest automobile distributors, with the objective to become a global mobility player. Güil Mobility Ventures includes an accelerator, a company builder, and a VC fund.
In the context of investing, “recycling ventures” has an environmental, social, and governance (ESG) mission. With ESG’s rising popularity, more VCs are now looking into higher impact when choosing companies for their portfolios. A second chance with güil helps startups save energy, human (and other) resources, as well as their investors’ money.
Thanks to lower competition and a rapid growth environment, LatAm is an excellent playground for relaunching startups that face challenges in the U.S. and other developed markets. Although the
Many founders I worked with have shown that it’s possible to get past the “inertia” stage and gain the momentum to move forward. All of them have been able to identify and acknowledge their challenges — the first step toward solving them.
Being part of a company builder raises the chance of success. According to güil’s data, it takes 36 months on average to raise seed funding for a new startup. For their peers, accelerated in a company builder, the time spent fundraising shortens by two-thirds, to around 10.7 months.
Acceleration in a company builder also made fundraising attempts 565 times more successful. If an average new venture has a 0.15% chance to raise seed funding, for startups backed by company builders the success rate is 84%.