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What The Second Wave Of Layoffs Means For Workers And Startups
By Pavel Shynkarenko After the 2024-25 job cuts at Google, Amazon and other tech companies, the second wave of tech layoffs is rewriting the startup labor market. Skilled professionals are suddenly available, creating both opportunity and pressure for founders and workers alike. Startups now compete for talent that once seemed untouchable, while employees face longer job hunts and rethink how and where they work. Higher expectations, more side gigsPavel Shynkarenko With talent flooding the market, candidates are demanding more flexibility and clearer growth paths, even as many accept contract work or lower pay to stay employed. The typical job search now stretches six to seven months, even longer for those needing visas or relocation. That uncertainty has fueled a surge in freelancing and side projects. Bankrate reports that 36% of American adults now have a side gig, with more than half of them having started in the past two years. While many professionals didn’t plan to freelance, they turned to it because they had no other choice. For some, it has proved liberating, with confidence and job satisfaction rising compared with corporate roles, according to our internal data. Despite all the buzz in the media and even on Reddit, overemployment — the trend of holding two jobs — remains a niche phenomenon, affecting roughly 5% of workers, according to the Federal Reserve Bank of St. Louis. The more common pattern is a mix of contract work and short-term projects, which gives startups a chance to hire A-level talent for fractional roles they couldn’t have afforded before. Smaller, sharper teams Payroll is every startup’s biggest cost, and founders are trimming teams while raising output per employee. The examples are striking. Midjourney reports about $200 million in ARR with a staff of only 11. Cursor has reached roughly $100 million with 15-20 people. Data from Carta shows that the average seed-stage team in the consumer and fintech sectors has declined by nearly half since 2022. This lean approach is spreading beyond early-stage ventures. Around 90% of tech executives say they are open to hiring freelancers during peak workloads; more than 28% already integrate them into daily operations. As this makes clear, smaller core teams, supplemented by trusted project-based workers, can move faster and spend less. Opportunity on both sides For workers, the takeaway is that startups may now be the safer bet. Mid-sized firms that once promised stability are cutting jobs, while startups are candid about their risks and can reward performance with equity or future roles. A short contract can become a long-term stake. On the other hand, for founders, today’s market is a chance to recruit top engineers, designers and operators at terms that were impossible two years ago. It also demands a new mindset involving compensation flexibility, project-based roles and hiring processes built for speed. All in all, the second wave of layoffs has changed expectations and shifted supply and demand in the job market. Workers are blending traditional jobs with side gigs, and startups are proving that small, focused teams can out-execute much larger competitors. On both sides, adaptability is now the ultimate advantage; companies that remain nimble will win. Pavel Shynkarenko, founder and CEO of Mellow, is an entrepreneur with more than 20 years of experience, and a freelance economy pioneer who aims to transform how companies engage with contractors. In 2014, Shynkarenko launched his first HR tech company, Solar Staff, a fintech payroll company for freelancers, which showed $10 million-plus in revenue for 2022 and 2023. In early 2024, responding to the growing demand for specialized solutions for long-term interaction with contractors, Solar Staff, as a global company, pivoted to Mellow ($1 million MRR). Related reading: Illustration: Dom Guzman
A Record Share Of Startup Funding Is Going To $100M+ Rounds
The percentage of U.S. startup funding going to rounds of $100 million or more reached an all-time high in 2025. It’s a development that should surprise no one who has been following the rise of AI megarounds. An estimated 70% of all U.S. startup funding 1 this year went to jumbo-sized financings of $100 million and up, per Crunchbase data. That equates to around $157 billion spread across more than 300 reported rounds. For a sense of how that compares to prior years, we took a look at the share of investment to these big rounds over the past eight years. How 2025 compares to the last peak Notably, this year’s tally is not the highest dollar sum on record. That title goes to 2021, the peak of the last bull market. Four years ago, a red-hot IPO market, soaring tech stock prices, and startup investors’ ample appetite for writing big checks helped send funding totals to stratospheric levels. While much of that went to prominent unicorns, early stage dealmaking was also way up. This year, by contrast, a few big names are taking a much larger share of the funding pie. The largest deal — OpenAI’s unprecedented $40 billion SoftBank-backed financing — alone accounts for roughly a quarter of all funding to $100 million+ megarounds. Investment is also, of course, much more heavily concentrated around artificial intelligence. More than two-thirds of megaround investment this year went to companies in AI-related categories, per Crunchbase data. The global state of megarounds Globally, the megaround picture doesn’t look dramatically different. For 2025, around 60% of all startup funding went to financings of $100 million or more, per Crunchbase data. That puts this year roughly on par with the 2021 market peak for funding share, as charted below. Evolution of an asset class So will this increasing capital concentration last? Every time we see a new trend emerge in venture funding, the question arises: Is this a cyclical blip or simply the new normal? This time around, a solid case could be made both ways for the rise in funding share going to big rounds. On the “blip” side, it does look like the rise of Generative AI behemoths is a phenomenon very specific to this cycle. Yet concentration of capital among a smaller collection of megarounds isn’t only a Gen AI thing. Investors are also scaling up in the age old pursuit of having the most likely companies to succeed in their portfolios. They’re willing to write bigger checks at higher valuations for the privilege of getting into a competitive deal. Related Crunchbase query: Related reading: Illustration: Dom Guzman
Wearables Startups Are Having A Moment
Generally speaking, if you’re wearing a technology on your body, you have to really love it or find it deeply useful or even essential. That’s a high bar, which helps explain why wearables have long been a fairly niche area for startup investment. Per Crunchbase data, the category reliably attracts less than 1% of all venture funding in a given year. This year, however, the space is looking comparatively perky. Largely that’s due to a single company: Oura, maker of a smart ring that collects data on dozens of personal health and wellness metrics. Earlier this month, the 12-year-old Finnish company announced that it closed on more than $900 million in a Fidelity-led financing at an impressive $11 billion valuation. The raise comes in the wake of sharp growth, with Oura expecting to reach $1 billion in sales this year. Beyond Oura But Oura isn’t the only wearables-related company pulling in significant venture investment recently. Using Crunchbase data, we put together a sample list of 18 companies funded in roughly the past year innovating in this area. Funded startups have a broad array of chosen use cases as well. While medical and health monitoring remains the most prevalent application, we’re also seeing the AI boom trickling into more consumer-focused offerings outside the health care realm. Smart lenses, glasses and cow collars In this arena, one of the largest and most recent rounds went to Xpanceo, a startup developing smart contact lenses that incorporate a microdisplay and external sensors to provide wearers with useful information based on their focus. The 4-year-old, Dubai-based company raised $250 million this summer at a $1.35 billion valuation. Nothing, a maker of Android smartphones, earbuds and watches, is another wearables developer, albeit not a pure-play in the space, with a big round of late. The startup closed on a $200 million Series C last month to further its vision of an “AI-native platform in which hardware and software converge into a single intelligent system.” The company cited smart glasses as one of the devices in which it envisions incorporating its operating system. And while wearables is usually understood to be a category for humans, we did mix it up a bit in our list by including Halter, a maker of a platform that combines smart collars and virtual fencing for ranchers to manage their cattle. It closed on $100 million in Series D funding this summer at a $1 billion valuation. Health and medical conditions Wearables for monitoring medical conditions are also still drawing investors’ attention with two established names each picking up $100 million financings this year. San Diego-based Biolinq, which has developed a wearable biosensor that measures glucose levels continuously just beneath the skin’s surface, secured its $100 million round in March. A month earlier, VitalConnect, a San Jose, California-based maker of wearable, connected patches for remote monitoring of cardiac health, secured a round of the same size, led by Ally Bridge Group. We’re also still seeing some varied startup activity around health-monitoring wearables. An offbeat one that caught our eye was Epicore Biosystems, which develops a wearable that tracks biomarkers in sweat to measure hydration, nutrition, stress and other physiological data. Deep-pocketed competition Being in an offbeat niche might provide considerable advantages to a startup. That’s because wearables startups play in a space that also happens to draw the largest technology companies in the world. From Apple watches to Google Fitbit devices to Meta’s AI glasses, giants with valuations in the trillions are finding appeal in the space. One of Apple’s newest offerings — AirPods with live translation — shows the technological sophistication of wearables is only on the rise. Even so, we’re betting startups will continue to find ways to innovate in ways that differentiate them from the tech giants. In particular, they have the advantage of marketing to a small initial early-adopter crowd and tweaking a product until it’s ripe for a much wider audience. Related Crunchbase query: Illustration: Dom Guzman
The Week’s 10 Biggest Funding Rounds: Biotech Dominates A Busy Week
Want to keep track of the largest startup funding deals in 2025 with our curated list of $100 million-plus venture deals to U.S.-based companies? Check out The Crunchbase Megadeals Board. This is a weekly feature that runs down the week’s top 10 announced funding rounds in the U.S. Check out last week’s biggest funding rounds here. This week offered a change of pace on the giant round front as it was a biotech company, rather than an AI startup, at the top of the ranks. Kailera Therapeutics, a developer of obesity therapeutics, led with a $600 million Series B. Other sizable financings went to companies offering fractional aircraft ownership, fintech services and hair loss treatments. 1. Kailera Therapeutics, $600M, biotech: Waltham, Massachusetts-based Kailera Therapeutics, which focuses on treatments for obesity, announced a $600 million Series B financing led by Bain Capital Private Equity. The company plans to initiate Phase 3 trials by year end for an injectable therapy to treat obesity. 2. Bond, $350M, aviation: Bond, a company offering fractional ownership for its fleet of private aircraft, raised $350 million in debt and equity funding. The financing consisted of $320 million in debt and equity from funds and accounts managed by Kohlberg Kravis Roberts along with $30 million in equity investment from founding partners. 3. (tied) Deel, $300M, payroll and compliance: HR and payroll platform Deel picked up $300 million in fresh funding. Ribbit Capital, Andreessen Horowitz, and Coatue led the financing. The round set a $17.3 billion valuation for the 6-year-old company, which said it recently surpassed $1 billion in annual recurring revenue. 3. (tied) Vantaca, $300M, business software: Vantaca, a provider of software for homeowners associations and management companies, said it secured a growth investment of more than $300 million led by Cove Hill Partners. The financing set a $1.25 billion valuation for the Wilmington, North Carolina-based company. 5. Kardigan, $254M, biopharma: Kardigan, a startup focused on developing cardiovascular drugs, closed on $254 million in a Series B backed by T. Rowe Price, Fidelity, Sequoia Heritage and Arch Venture Partners. The round brings total funding to date to more than $554 million, per Crunchbase data. 6. Upgrade, $165M, fintech: Upgrade, a provider of consumer loans, credit cards and online accounts, pulled in $165 million in a Series G financing led by Neuberger Berman. Launched in 2017, San Francisco-based Upgrade has raised more than $750 million in venture funding to date, per Crunchbase data. 7. VeraDermics, $150M, dermatology, hair regrowth: New Haven, Connecticut-based VeraDermics, a startup developing therapeutics for dermatologic conditions, raised $150 million in a Series C round led by SR One. Funding will go toward ongoing trials for an oral therapeutic designed for hair regrowth. 8. Pelage Pharmaceuticals, $120M, hair loss treatment: Pelage Pharmaceuticals closed a $120 million Series B round co-led by Arch Venture Partners and Google’s GV. The Los Angeles startup is focused on a topical small molecule designed to reactivate dormant hair follicle stem cells for men and women experiencing hair loss. 9. Peptilogics, $78M, therapeutics: Pittsburgh-based Peptilogics, a developer of surgical therapeutics to treat and prevent serious medical device infections, raised $78 million in a Series B2 financing. Presight Capital, Thiel Bio and Founders Fund led the round. 10. MD Integrations, $77M, telehealth: Telehealth platform MD Integrations landed $77 million in growth financing from Updata Partners and Denali Growth Partners. The New York-based company works with digital health brands to provide access to a network of doctors for patient consultations. Methodology We tracked the largest announced rounds in the Crunchbase database that were raised by U.S.-based companies for the period of Oct. 11-17. Although most announced rounds are represented in the database, there could be a small time lag as some rounds are reported late in the week. Illustration: Dom Guzman
New To Silicon Valley? What I Wish I’d Known As An Immigrant Founder Back In 2017
By Vasyl Dub Despite President Donald Trump recently imposing a $100,000 application fee on new H-1B visas, San Francisco remains a magnet for international AI founders keen to tap into the epicenter of innovation. I was one of those wide-eyed entrepreneurs back in 2017, when I first packed my bags and moved from my native Ukraine to SF to scale my startup, Animal ID. Unfortunately, I ended up returning home demoralized and depressed as my trip had led to so many rejections. However, I eventually realized that the problem wasn’t my tech — it was that I hadn’t understood the unspoken rules of Silicon Valley. After spending years trying to break into the Valley, things finally turned around for me. Now, as a startup mentor at Stanford University and Alchemist Accelerator, and founder of Raisable Founders Hub, I’ve made it my mission to help founders, especially immigrant entrepreneurs, avoid the unnecessary mistakes I made. My approach boils down to a few simple steps: shift your mindset, build a relevant network, validate your idea deeply, and then build your strategy. This is critical for founders navigating today’s funding frenzy. Here’s what I wish I’d known when I first set foot in Silicon Valley: Understand the principles by which the Valley livesVasyl Dub Silicon Valley runs on trust, and trust is something that needs to be earned. Therefore, it’s best to start building it long before you arrive: Do your research and connect online with people you’d like to meet up with. Make sure you have something to offer. The Valley rewards those who contribute first. Building a startup here is different from anywhere else due to extremely high costs, relentless competition and a generally much faster pace of doing things. All of this will test your adaptability — which is a key skill investors will be on the lookout for. The right mindset can’t be bought, but it can be developed by immersing yourself in the ecosystem and engaging with the right people. Surround yourself with like-minded people Silicon Valley is filled with people who will challenge everything you do from day one. The people you surround yourself with can either fuel your growth or drain your momentum. Don’t waste time chasing generic networking opportunities. Instead: The bottom line is: Focus on nurturing authentic connections that can flourish into long-term collaborations. Ask for advice first, then intros Many founders obsess over getting investor introductions. But an intro without the right preparation is a wasted opportunity. Instead of fixating on warm intros, focus on validating your ideas. Explain to everyone you meet how your solution solves a specific problem and why your team is the best to do it. Absorb their feedback and use it all as an opportunity to refine your pitch. Every discussion helps you understand how to frame your value proposition more effectively. Seek out great mentors. The best ones don’t give you answers — they help you ask better questions. Finally, not every interaction needs to lead to fundraising, the goal should be to build a sustainable company — so be open to any and all opportunities or connections that come your way. You never know, the next person you meet could become a future co-founder, adviser, customer or even a lifelong friend. Vasyl Dub is a startup mentor at Stanford University and Alchemist Accelerator, and founder at Raisable Founders Hub. Related reading: Illustration: Dom Guzman
Cybersecurity Startup Investors Pulled Back In Q3
After a lively first half of the year for cybersecurity startup funding, investors pulled back some in the third quarter. In total, investors put just over $3.3 billion globally into seed- through growth-stage rounds for cybersecurity-focused companies, per Crunchbase data. That’s about a third lower than the prior quarter, a robust period for dealmaking, but still about a third above year-ago levels. Deal counts also declined sequentially in Q3, but still exceeded year-ago totals. Megarounds of note As usual, much of the quarter’s fundraising tally came from a few big rounds. For Q3, the largest round went to Quantinuum, a quantum computing unicorn that isn’t a pure-play cybersecurity company but does cite encryption and data protection among the core use cases for its technology. The Broomfield, Colorado-based company, which was spun out of Honeywell, closed a $600 million Series B in August led by Nvidia’s venture arm. The next-largest financing was a $230 million Series C for Austin, Texas-based Ontic, a provider of intelligence tools for corporate security. In third place was San Francisco-based Vanta, an AI-enabled security and compliance platform that pulled in a $150 million Series D. For a broader listing, below we ranked 10 of the largest cybersecurity-related financings of the quarter. Exits The quarter also brought a couple good-sized startup exits of both the IPO and M&A variety. Netskope, a cloud-security provider, delivered on the IPO front, raising more than $900 million in a well-received September debut. Founded in 2012, the Santa Clara, California-based company previously raised $1.4 billion in early- through late-stage financing. As for acquisitions, the largest was Tokyo-based Mitsubishi Electric’s purchase of San Francisco-based Nozomi Networks, a 12-year-old company focused on protecting critical infrastructure from cyber threats, in a deal reportedly valued at around $1 billion. Ups and downs So are these still bullish times for cybersecurity investment? While investment to the space was down sequentially this quarter, the drop does not appear sufficiently dramatic or prolonged to draw broad conclusions. On public markets, major cybersecurity indexes continue to perform well, and, among newcomers, Netskope has held steady. So, that looks encouraging. On the M&A side, we’re also still waiting for a final conclusion of Google’s planned $32 billion acquisition of cybersecurity provider Wiz, announced in March. If the deal passes regulatory muster and closes, it would rank as the largest startup acquisition to date and mark another upbeat development for the security sector. For now, we’ll keep an eye out to see if there are any stronger headwinds portending a shift in direction for the space. Related Crunchbase list and query: Related reading: Illustration: Dom Guzman
Deel Lands $300M At $17.3B Valuation Amid Spying Saga, Uptick In HR Software Funding
HR and payroll platform Deel has raised $300 million in fresh funding at a $17.3 billion valuation. The deal was led by new investor Ribbit Capital and previous investors Andreessen Horowitz and Coatue Management. Other investors including General Catalyst and Green Bay Ventures also participated. The round for New York-based Deel comes as funding for HR tech startups overall has seen an uptick this year. Through mid-September, HR software startups globally have raised $1.9 billion in venture funding this year, per Crunchbase data. That’s just under the $2 billion raised by such startups in all of 2024. U.S.-based human resources software startups have raised a combined $1.2 billion, up from the $1.1 billion raised last year. Still, this year’s figures are a far cry from 2021’s banner figures, when startups in the sector raised $10.5 billion globally, per Crunchbase data. Deel’s new round also follows an ugly and closely watched corporate espionage scandal between Deel and rival Rippling, which itself raised a $450 million Series G round at a $16.8 billion valuation earlier this year, despite the drama. Investors were apparently more interested in Deel’s business metrics than the Rippling saga. Deel said it posted $100 million in revenue last month for the first time, and closed out its third consecutive year of profitability. It hit $1 billion in ARR earlier this year and says it now counts more than 37,000 businesses as customers, processing $22 billion in payroll a year. The company, which has now raised nearly $1.3 billion from investors since its founding in 2019, said it will use the cash infusion for strategic acquisitions, to expand its geographic reach to more than 100 countries by 2029, and to accelerate its automation and AI-powered offerings. “Deel — itself a fully remote, global company with employees in over 100 countries — is uniquely positioned to build products for global expansion,” Ribbit Capital founder Micky Malka said in a statement. “The company and its leadership have a limitless opportunity ahead of them.” Related Crunchbase query: Related reading: Illustration: Dom Guzman
These Are Some Leading Spaces For AI Investment At Seed And Early Stage
Given that a majority of U.S. startup investment goes to artificial intelligence companies these days, there’s clearly a wide variety of newcomers getting funded. So where are seed- and early-stage investors placing their bets? To shed some light on this question, we analyzed a dataset of AI-focused startups that raised at least a few million dollars in seed- or early-stage funding this year. While it was a varied crew, a few areas stood out as particularly popular. These include: back-office tools, robotics, drug development and healthcare automation. Stepped-up early-stage funding to these areas comes as the most prominent generative AI startups have largely matured to later stage. Much of the current early-stage generation of startups, by contrast, is focused less on broad, general purpose AI models and more on solving problems and automating tasks within specific industries. Without further ado, here are the four areas that caught our eye. No. 1: Back-office automation Back-office automation was one of the more popular themes for AI-related seed- and early-stage investment, per Crunchbase data, and seemingly for good reason. Tasks related to accounting, payroll, compliance and other back-office functions pose a significant cost to all businesses. But back-office burdens can be particularly daunting for smaller businesses, which lack the economies of scale of larger rivals. As such, that’s where a number of startups are focusing their endeavors. For a sense of where funding is going, we put together a sample list of 10 companies that raised seed- or early-stage rounds this year with a back-office automation focus. No. 2: Robotics Anyone who’s ever performed a dull, dirty or difficult physical task has probably fantasized about having a robot take over. In recent quarters, a surge of funding to startups at the intersection of AI and robotics means that fantasy is now poised to move at least closer to reality. Per Crunchbase data, we’re seeing a particularly strong wave of investment activity at seed and early stage. To illustrate, we put together a sample list of 14 companies funded so far this year. No. 3: AI tools for healthcare High on the wish list of many health providers is the ability to spend more time providing care and less on recordkeeping and compliance-related tasks. A slew of recently funded startups at the intersection of healthcare and AI are looking to assist in this goal with tools to automate some of the more tedious and repetitive tasks. To illustrate, we used Crunchbase to assemble a representative sample list of 10 companies in this area that raised seed- or early-stage funding. That list, however, is only a small portion of the full population of startups in the space funded this year, for which we also provide a sample query. No. 4: Drug development and medical research The intersection of AI and biotech is also a vibrant area for seed- and early-stage funding. So far in 2025, this has manifested most noticeably in a series of megarounds for Lila Sciences, a Cambridge, Massachusetts, startup working on what it calls a “scientific superintelligence platform” for life sciences, chemistry and materials science. Beyond Lila, however, a raft of other startups in AI and biotech have also raised good-sized seed- and early-stage rounds this year. Below, we aggregated a sample of 10 companies that stood out. But wait, there’s more While this article focused on four investment themes, there were quite a few more that stood out in our query. These included legal tech, go-to-market offerings, chip design, and innovations around AI-enabled voice and audio. As is typical at seed and early stage, the promise of all these areas sounds quite enticing. We’ll see in a few years, however, if visions of a less tedious back-office, more robot-enabled workforce, more streamlined healthcare system, and faster and more effective medical research come to fruition. Related Crunchbase lists and queries: Illustration: Dom Guzman