What doesn’t change in 2023

The constants in another year of flux

Ann Bordetsky
6 min readJan 9, 2023

As we kick off 2023, it’s tempting to focus only on what is changing in start-up land. What’s different, what’s new, what’s next?

There’s a flurry of market outlooks, tech trends and annual predictions. We get to work inside this magical cauldron of disruption. Whether it’s done by us (innovation) or to us (market reset, ugh) there is always change in store. It’s not often that we ask what stays the same.

I am reminded of this wonderful and wise quote from Jeff Bezos.

“I do get asked, quite frequently: ‘what’s gonna change in the next 10 years?’ I rarely get asked, and it’s probably more important — and I encourage you to think about this — is the question what’s not going to change? The answer to that question can allow you to organize your activities. You can work on those things with the confidence to know that all the energy you put into them today is still going to pay dividends in the years to come.” — Jeff Bezos

He is talking about commerce of course but his remark resonates in leadership, company build and venture.

Yes, 2022 was a bruiser. It brought a dramatic reversal in the venture fundraising environment, a major public market correction and whiplash in post-pandemic consumer and corporate behavior. And we’re not even done yet. This year we’ll see the ripple effects flowing through, with more tech layoffs and a culling of startup fates and fortunes (i.e. tough fundraising, down rounds and the one thing no one talks about…shut downs). It’s an uncomfortable time.

In a moment of flux, it’s worth considering what will not change that we can lean into with confidence.

  • What are the enduring forces that drive startup success
  • What are the founder qualities that rise to the top
  • What are the long-term innovation frontiers

Constant #1.

The market can’t kill you if it’s working.

Amidst the frothy market, the orientation of startups got warped (valuation hype over traction) but the fundamentals didn’t actually change.

  • Startups are ultimately an exercise in building enduring companies.
  • Companies that get to escape velocity, scale and endure are ones that build up market power and competitive advantage, deliberately and consistently over many years (through product, biz model, brand).
  • Hype and frothy valuations don’t mean much. Intense customer pull and talent arbitrage is what counts, and you need both to build.
  • If the bar seems high now, it’s worth remembering it was always this high for customers (even if not some investors). On the one hand, it’s never been easier to build but it’s never been harder to build a truly magical, 10x better product. A product that occupies a permanent place in people’s lives. But that’s the game, it’s not supposed to be easy.
  • Scaling efficiently and managing talent to peak performance, i.e. making the most of your resources, is critical and never went out of style. CEOs that know this do spectacularly well in any market.
  • True validation comes from customers, not investors or tech headlines. Venture is a catalyst and going for higher valuations is like cranking up the speed and incline on the treadmill at the same time. A winning product and ability to generate cash flow is what creates options.
  • Venture underwrites future growth, big outcomes and L-T founder potential, not incremental progress. It usually comes with a multi-year personal commitment to the board / team. This level of conviction requires deep and detailed diligence from investors and that’s fair.

Startups are indeed serious and humbling work. That just doesn’t change. It’s also fun and the most energizing and creative endeavor out there!

Constant #2. Founders and teams with the right orientation tend to outperform, regardless of market conditions. We will see certain founder qualities propel companies through this time. Survive and thrive. Here’s a few that separate leaders from the pack:

  • Discipline and business acumen beyond storytelling and vision.
  • Clear-headed, truth-seeking decision making and judgment.
  • “Long-term greedy” mindset in fundraising, team building, investor relationships and validation (it’s the ultimate marshmallow test).
  • Relentless drive to win your space and ability to see paths to sprint past competitors (especially when to play offense vs. defense).
  • Leadership and communication quality that earns trust, credibility and loyalty with customers and employees (it happens OFF twitter).
  • Resourceful. Resourceful. Resourceful. Or as the saying goes — if you can’t go through the door, go through the window.
  • Willingness to ask for help and solicit constructive feedback. Harder times require more vulnerability and self-management, not less.

In many ways, it’s easier for serious builders to stand out in 2023. Resilient, pragmatic and high-integrity founders will get rewarded in this time.

Constant #3. Trends shift but innovation frontiers unfold over many years. Incumbents wane but it takes years and decades. Timing is everything.

The question every investor is asking is what’s the new, new thing? What emerging tech can power companies into existence?

We just had virtual and remote work. Virtual learning. Crypto and decentralized web3. Digitization accelerated in nearly every industry. We’ve seen many fits and starts in the last 3 years, so I go back to Bezos’ quote on tuning into the things that are not going to change.

With that in mind, here’s a few of the innovation arenas that I’m paying attention to in 2023 and beyond:

Generative AI is having a Cambrian moment but broadly we are on an inevitable march of AI powering the next generation of software, mobile apps and human activity. We will see this transition in next 5 years.

Mobile brought us frictionless connection, creativity and commerce but that unfolded over a series of accelerating events along the way. We’ll see something similar with AI and it’s already under way. AI in software isn’t new (TikTok ahem) but the latest generative AI is a big step-function improvement. With each step, we will unlock new applications and reimagine familiar use cases. Here’s some things that are coming:

  • Ubiquitous personalization in search, media, learning, commerce
  • Synthetic, endless media and entertainment content, on demand
  • New formats for self-expression and curated identities online
  • Acceleration of independent work as creatives and skilled knowledge workers gain productivity superpowers with AI assistants and tooling
  • Conversational AI that can be not just utilitarian (order me a pizza) but fulfill social emotional needs, like friendship and chit chat
  • Recreating memories, people and moments from our past, a kind of easily retrievable individual memory bank (time machine?)
  • Weird and wonderful new stuff we can’t imagine at the moment

There will also be massive productivity gains and automation benefits in Enterprise applications but it will be a race of startup vs. incumbent. SaaS majors are embedding AI and taking a big slice of the opportunity.

The most exciting, culture-altering uses of AI will be in Consumer first, I can’t wait!

Gen Z wants its own stuff and big categories are up for grabs.

Generational turnover is inevitable in tech (remember Yahoo?) and it is starting to manifest as Gen Z influences consumer and workplace culture. For Gen Z the 90’s and 2000’s are vintage, gasp! Enduring consumer needs that get reimagined for Gen Z:

  • Communication and connection: social, dating, self-expression
  • Commerce and lifestyle: conscious consumption, re-commerce, nomadic life, live shopping, and the proliferation of digital goods
  • Careers: independent work, social learning, professional networks
  • Entertainment: TikTok is winning but more will happen in gaming, media, immersive AR (Apple launching their headset in 2023?)
  • Financial health and wealth for digital natives

Long arc of digitization and decarbonization in industry

I can’t do it justice here as this is a broad swathe of activity and I only look at a sliver of it, but I’ll note a few areas of opportunity:

  • B2B marketplaces and commerce platforms
  • Decarbonization software and business intelligence for enterprises
  • Vertical SaaS for overlooked sectors (think boring but essentail)

Now, VCs definitely do not predict the future. Founders envision it, craft it and show us the way. We just try to keep up and strap some booster rockets on at the right time. 🚀

If you want to get in touch, check out my user manual and you can reach me at abordetsky@nea.com.

Disclaimer: The opinions expressed here are my own and do not represent NEA. They were not generated or edited by an AI, though I did wonder if it would do a better job than me.