Denver, CO: Stage has announced the acquisition of CleverFunnel Digital, a Denver-based agency with a focus on market discovery and strategic growth. The move represents a significant step forward for Stage, furthering its mission of supporting early-stage, venture-backed companies unable to raise continuing capital in today’s environment.

Stage, a majority female-led private equity group, announces the closing of Fund II, providing alternative paths to Early-Stage Startups.

Welcome to the Wall Street Lab podcast, where we interview top financial professionals and deconstruct their practices to give you an insider look into the world of finance.

2022 has seen a marked decline in venture funding down 23% in Q2, the largest quarterly percentage drop in funding in nearly a decade. This signals a cooling off in the venture market, however the overall dollars going into venture are still almost double what they were in 2019. Perhaps more importantly, there is also an estimated $290 billion dollars of undeployed venture capital. That’s almost double the annual average amount from 2016 – 2020.

The typical venture model relies on a lot of misses and a few home runs to offset losses elsewhere. But for startups that fail to get follow-on funding, distressed venture offers a chance to rebuild outside of a growth-at-all-costs mindset.

Most startups don’t make it. While some companies fail because they are trying to solve a problem that doesn’t exist or trying to target a market that’s too small to produce profits, many falter because they aren’t growing quickly enough to attract or retain VC backing. Lauren Bonner calls these companies thoroughbreds — the unsexy workhorses of the industry — and her firm MBM Capital supplies them with capital when their other backers abandon them. If venture funding continues to cool off, she predicts the market will soon see a number of worthwhile companies needing help.

Krista Morgan knows how difficult it is to build a startup. She also knows just how quickly it can all fall apart.

2021 was a banner year for early-stage investments; venture funding doubled year over year to $200 billion across 8,000 startups. The uncertainty and disruption of a global pandemic did not compress valuations as initially expected, and the amount of funding per round means an average Series A company has now raised over $20 million. And yet, amidst this investment fervor, 50% of Series A companies will fail to raise a Series B round, taking them off the venture path.

Stage Fund, based in Denver, Colorado, is a majority female-led private equity fund focused on acquiring controlling interest in companies undergoing a change in capital structure, strategy, operations, or growth. Since 2009, Stage has helped dozens of companies restructure their equity and alleviate debt. As a private equity fund, we share insights from our general partners, team members, and from our community of founders to increase access to knowledge about alternative paths to success when faced with complex and difficult decisions.