Investors are sitting on a record amount of dry powder, said PitchBook senior analyst Kyle Stanford onstage at Collision this week, in front of a crowd packed with venture capitalists holding that cash and founders hungry for a taste of it. 

But many investors aren’t at the Toronto tech conference to dole out the US$550 billion or so the industry has accumulated, despite having access to more than 1,000 startups under one massive roof. Instead, many have spent this week checking in with existing portfolio companies and catching up with colleagues they’ve scarcely seen since the start of the pandemic. 

OMERS Ventures managing partner Michael Yang said his Collision app DMs have been blowing up with requests from startups looking to meet, pitch their business and raise funding. But he hasn’t paid them much attention.

“They’re not deploying it. Everyone’s sitting on their money,” Martin Basiri, the co-founder of edtech ApplyBoard who launched his new company Passage at Collision this week, told The Logic. 

This year has been tough on tech. From Silicon Valley Bank’s collapse in March (a topic that some investors at the conference said they want to move on from), to a steep drop in venture capital dealmaking, the downturn fears sowed in 2022 have in many ways borne out this year. 

The slowdown has left some investors—with, perhaps, the exception of those pursuing AI deals—resigned to the possibility that activity will remain slow through the summer or even until 2024. 

Rather than sweating the tech downturn at Collision, some investors are using the lull to reconnect with colleagues over team dinners and after-hours drinks. “Everyone’s hopped up,” said Yang. “Fuelling energy from the vibes of being in-person.” 

That attitude clashes with the conference’s more sombre economic backdrop. 

Panel discussions at the packed venture stage this week have focused on startups’ challenging realities in this market, like raising down rounds and extending runway with existing cash. 

Basiri said that despite his track record of raising some $600 million over the years for ApplyBoard, securing his $40 million seed round for Passage this year was a slog. 

Daniel Shalinsky, co-founder of Vancouver-based interview platform Withe said after raising a small pre-seed round this spring, the company scaled back its hiring plans—from five new employees to just one or two—in the shaky market. 

In a panel on deep-tech investing, Brooklyn-based VC Kristin Ellis advised companies to take this moment to “put your head down.” 

“The current market is hard,” she said. “This is not a 2021 world. Figure out who your customers are, figure out what you’re building.” 

Yang said he’s holding out for 2024 for deals to pick up. “The joke we all have is, that’s why VCs are publishing on LinkedIn and thought pieces and all that,” he said, “because the deal activity is just not that compelling.” Until that changes, he’s got time to kill with his colleagues. – Catherine

With files from Jonathan Got and Murad Hemmadi