Jason Lemkin: Predictions for 2024 - What Does a Trump Administration do for Startups? | E1099
Jason Lemkin (guest), Harry Stebbings (host), Narrator
In this episode of The Twenty Minute VC, featuring Jason Lemkin and Harry Stebbings, Jason Lemkin: Predictions for 2024 - What Does a Trump Administration do for Startups? | E1099 explores jason Lemkin Dissects Venture Reality: SaaS Saturation, Decacorns, Trump, 2024 Jason Lemkin and Harry Stebbings review 2023 in venture and SaaS, highlighting explosive AI growth (OpenAI, Midjourney), standout operators like HubSpot and Nvidia, and the broken dynamics of late-stage funding and reserve models.
Jason Lemkin Dissects Venture Reality: SaaS Saturation, Decacorns, Trump, 2024
Jason Lemkin and Harry Stebbings review 2023 in venture and SaaS, highlighting explosive AI growth (OpenAI, Midjourney), standout operators like HubSpot and Nvidia, and the broken dynamics of late-stage funding and reserve models.
Lemkin argues that SaaS growth deceleration may be partially permanent as software spend nears saturation, while early-stage remains vibrant and venture increasingly becomes a permanent hunt for decacorns, not just unicorns.
They explore the changed LP/VC environment, founder behavior during the 2021 bubble (secondaries, entitlement, ‘run-for-salary’ startups), and the shift in advice around when to sell or go public amid compressed multiples.
Looking to 2024–25, they predict more IPOs out of necessity, a wave of mid-sized M&A, continued AI-driven concentration of capital, and a weeding out of mediocre VCs and “pretty good” founders who can’t deliver outlier outcomes.
Key Takeaways
SaaS growth has structurally slowed, even as efficiency and stock prices improved.
Public SaaS grew only ~16% in 2023 while stocks rose ~41%, largely driven by price increases and upsell into the base rather than new logo growth; Lemkin worries some demand deceleration may be permanent as software’s share of GDP saturates.
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Venture is now a permanent decacorn-hunting business, not a unicorn-hunting one.
Post-2021, LP expectations and fund sizes mean Series A+ investors must underwrite Stripe/Databricks/OpenAI-scale outcomes; sub-multi-billion exits rarely move the needle for large funds, shifting risk appetite and selection criteria.
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Reserve behavior has changed: many big funds are not reliably doing pro rata anymore.
Overvalued ‘middle-corn’ portfolios and broken reserve models have pushed multi‑billion funds to skip pro rata even in good companies, forcing founders to identify one catalytic insider who will actually lead and socially force others into a round.
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Founder incentives in the 2021 bubble often became misaligned with stakeholders.
Large secondaries (e. ...
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Advice on when to sell has flipped: windows of liquidity should be taken seriously.
Lemkin now regrets uniformly telling founders to “never sell if it’s working,” seeing many who declined peak 2020–21 offers and will never see those prices again; he aligns more with Bill Gurley’s view that venture returns concentrate in short liquidity windows that must be used.
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2024–25 will likely bring more IPOs out of necessity, not exuberance.
After three years of compressed multiples, mature companies like Stripe and ServiceTitan may accept lower valuations, “grow up,” and go public to enable employee liquidity, M&A, and operational adulthood rather than waiting for a 2021-level market to return.
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Early-stage remains vibrant, but only truly exceptional founders justify venture returns.
Lemkin says he’ll no longer back “pretty good” founders regardless of traction, insisting that only top 0. ...
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Notable Quotes
“This is the first year I’m worried. The deceleration that we saw last year, I am worried some of it may be permanent.”
— Jason Lemkin
“We are permanently decacorn hunters now. I don’t think there are unicorn hunters anymore.”
— Jason Lemkin
“If you get a good offer and it’s in bullish times, take it, because it may be a decade until we see another boom like 2021.”
— Jason Lemkin
“If you don’t know in 20 minutes that this is one of the best founders you’ve ever met, don’t do the investment.”
— Jason Lemkin
“You’ve got to remember, it’s not your money. You gave it to them. It’s not your money to get back.”
— Jason Lemkin (relaying an LP/VC perspective)
Questions Answered in This Episode
If SaaS spend is nearing saturation relative to GDP, where exactly will the next trillion dollars of software value be created?
Jason Lemkin and Harry Stebbings review 2023 in venture and SaaS, highlighting explosive AI growth (OpenAI, Midjourney), standout operators like HubSpot and Nvidia, and the broken dynamics of late-stage funding and reserve models.
Get the full analysis with uListen AI
How should founders practically balance personal liquidity (secondaries) with long-term alignment to employees and investors in non-bubble markets?
Lemkin argues that SaaS growth deceleration may be partially permanent as software spend nears saturation, while early-stage remains vibrant and venture increasingly becomes a permanent hunt for decacorns, not just unicorns.
Get the full analysis with uListen AI
Given reserve-model breakdowns, what concrete signals should founders look for to identify which investor will actually catalyze an inside round?
They explore the changed LP/VC environment, founder behavior during the 2021 bubble (secondaries, entitlement, ‘run-for-salary’ startups), and the shift in advice around when to sell or go public amid compressed multiples.
Get the full analysis with uListen AI
In a world where venture is structurally chasing decacorns, what happens to solid businesses that can realistically exit for $300M–$1B?
Looking to 2024–25, they predict more IPOs out of necessity, a wave of mid-sized M&A, continued AI-driven concentration of capital, and a weeding out of mediocre VCs and “pretty good” founders who can’t deliver outlier outcomes.
Get the full analysis with uListen AI
How should emerging managers differentiate and access true outliers when large, brand-name funds are also concentrating capital into the same few winners?
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Transcript Preview
I know everyone said (cash register sound) they did more deals, but I didn't see enough greed in the markets in 2023.
This is Jason Lemkin, founder and CEO of SaaStr, the biggest platform for SaaS and B2B founders in the world. I sat down with him and recapped (typewriter sound) the biggest events in venture in 2023, and placed our boldest predictions for 2024. SaaStr early stage markets in 2024.
Yes.
What do you think?
This is the first year I'm worried. The deceleration that we saw last year, I am worried some of it may be permanent. You could only spend so much of the global GDP on software. I think 2024 is the year of, you might as well go public.
Who else is in the category of just do it, it's time to grow up?
I think there's some fun ones. The first one was (beep)
Jason, I am so excited for this. This is our first show of 2024, so thank you-
Wow.
... so much for joining me today.
Happy New Year. Especially after just a banner year for unicorns and startups that was 2023, right? It's good to be back.
(laughs)
Thank you, Harry. How many unicorns did we have last year? A thousand? 800 in 2023? How many new unicorns were there?
I mean, I'm thinking of a new joke for my next investor update, which is like, yeah, 13 unicorns of which six remain. (laughs)
(laughs) That's fair.
But that's a very confident start to an investor update.
(laughs)
Um, listen, I wanna start briefly for anyone that doesn't know or hasn't listened before, um, before we dive in, Jason, can you just explain who you are and what SaaStr is? And then we're gonna dive in.
Yeah. I was a, I was an early SaaStr founder with the generations of, uh, Aaron Levie at Box and Rene Lacerte and Drew Houston. Um, and then I accidentally sold my company, EchoSign, too early to Adobe in 2011. And since then, I've been investing. Harry and I have co-invested in a number of folks, um, and built this community called SaaStr that has, uh, it's the largest community in the world for SaaStr founders.
Uh, uh, listen, love it. Now I wanna dive in and we're gonna set the scene with two different parts to the show. We're gonna do-
Okay.
... one, which is a review, and then we're gonna do a predictions for 2024. So if we start on the review of 2023, I wanna start with a view of optimism. What do you think was the standout/best company?
Well, look, I mean, uh, I, I, there's only so much we can talk about OpenAI, right?
(laughs)
Um, but if, if literally they are... The funny thing about OpenAI is, you know, if they ended the year at 1.4 billion run rate, uh-
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