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With stocks falling into a bear market this year amid fears that aggressive rate hikes from the Federal Reserve will plunge the economy into a looming recession, top firms on Wall Street are advising investors to stick with stocks that have historically performed well during past downturns, such as consumer and healthcare companies.

Think long term.

Investing in the stock market during a recession can be difficult, but it's not impossible. The key is to have a plan and stick with it.

If you're just starting out with investing, here are some tips to keep in mind:

Think long term. Don't get discouraged by short-term fluctuations or volatility. You're not going to make money overnight; if you do, that's a good sign that you're playing with fire.

Don't get emotional about your investments; they go up and down all the time. Focus on long-term growth and profit, not short-term gains or losses.

Don't sell when the market is down — wait until it starts heading back up again before making any decisions about your portfolio.

It's important to diversify your portfolio by investing in different assets like stocks, bonds and real estate so you don't put all of your eggs into one basket (or stock). If one company tanks, chances are you'll still have others performing well enough to make up for its loss so your overall investment doesn't suffer too much damage from one bad pick.

Consider bonds.

Bonds are considered fixed income investments, and they're safer than stocks. In the event of a recession, bond prices tend to rise. That's because investors who have cash on hand will buy bonds when they see other investments falling in value.

Buy U.S.-based stocks. Stocks from companies based in the U.S. tend to weather recessions better than other types of investments do. That's because there's less risk that a foreign government will collapse or default on debt owed to Americans — as happened during the 2008 financial crisis when Lehman Brothers collapsed and AIG was bailed out by the government.

Diversify your portfolio across different sectors and industries so that if one sector suffers because of economic conditions, others may not be affected as much — or at all.

Look at consumer staples.

The best investments during a recession are consumer staples. These are companies that sell products that people need, not just want. For example, food, energy and water.

Look at consumer staples. Look at the companies that make these products and make sure they're stable in their businesses. Don't invest in any company unless you can see it being there for the next ten years or more.

You can also look at companies that produce things that are needed by everyone, like clothing or food. You don't have to buy stocks just because they're cheap; you can also buy them because they're good companies with good management teams who know how to run their businesses well.

Review real estate investment trusts.

Real estate investment trusts (REITs) are companies that own and manage commercial real estate. They provide investors with the opportunity to invest in real estate without having to go through the hassle of buying property directly.

There are two ways to invest in REITs: through mutual funds or exchange-traded funds (ETFs). Mutual funds buy shares of individual companies and then hold them for as long as possible. ETFs track an index, such as the S&P 500 index, by purchasing shares in each company listed on that index.

When you invest in a mutual fund or ETF, you're buying shares of the fund itself — not the underlying assets owned by the fund. This means that if your fund owns a piece of property that suddenly becomes worthless, the value of your investment will also drop sharply. But if you buy shares in a company that owns property worth $100 million but then loses half its value due to a downturn in real estate prices, you'll still have $50 million worth of assets on which you can collect rent payments every month which is still beneficial in the long run.

Check out consumer discretionary stocks.

Consumer discretionary stocks are a good place to start. They're sensitive to changes in consumer behavior and tend to perform well during recessions.

These stocks include:

Retailers and restaurants — These companies' sales often fall during recessions because people spend less on discretionary items like clothes and restaurant meals. But their profits remain strong because they cut costs during a downturn by laying off workers, lowering prices or selling off inventory below cost. This makes them attractive investments during recessions because they can quickly reverse losses once the economy recovers.

Auto manufacturers — Car sales tend to drop during recessions as consumers cut back on spending, but auto manufacturers can still make money by lowering prices and offering incentives like cash rebates and 0% financing deals that boost sales volume without hurting profits much.

Travel agencies — Travel agencies don't usually experience big drops in revenue during recessions since people generally still have vacation plans even if they're spending less on other things right now.

If you have cash to spare, consider buying a home.

The best way to invest during a recession is to buy a home.

There are plenty of other investments you could make, but the housing market has historically been one of the few that weathers recessions well. While other asset classes might take a hit or two along the way, homes generally hold their value well through downturns. And if you’re lucky enough to buy at the right time and place, you can make a lot of money on your investment over time.

Here’s how:

If you have cash to spare, consider buying a home. This is especially true if you’re thinking about buying in an area that has not yet recovered from its last recession — or hasn’t really felt the effects of this current one yet. After all, it takes time for prices to adjust after they drop, so some markets may still be undervalued compared with where they were before 2008-2009.

If you don’t have any savings and can only afford to buy a cheaper home than you otherwise would like — or if you need help getting into a better neighborhood — look into low down payment loans or mortgages insured by the Federal Housing Administration (FHA). They always have options available for all types of borrowers.

Takeaway: Here are a few things you can do to minimize the risk of investing during a recession.

The best way to invest during a recession is to find ways to minimize your risk. If stocks are down and there is an overall economic downturn, it's safest to stick with dividend-paying or income stocks that have been tested over the previous decades. Furthermore, it might be advisable to consider long-term investments as opposed to short-term investments as well. Short-term investments usually carry a history of risk in a recession, but long-term investing has proven itself to be effective even in times of decline.

Web 3.0 describes the future of the Internet after blockchain technology has taken hold. The Internet is a protocol for information exchange, and it has been around since the 1970s. The World Wide Web is an application built on top of the Internet that allows users to access documents and other resources through hyperlinks. The first web browser, called WorldWideWeb, was developed by Tim Berners-Lee in 1990 at CERN, a European physics research center.

The World Wide Web Consortium (W3C) defines web3 as “the next generation of the World Wide Web.” This includes new technologies and capabilities that are not available in today’s browsers or websites. The primary purpose of web3 is to allow users to interact with decentralized applications (dApps) without having to use a middleman like Google or Facebook.

The Internet we know today is called client-server architecture because it involves two distinct software components: clients and servers. Clients are devices like phones or laptops that connect to servers over the Internet through a client-server protocol such as HTTP (Hypertext Transfer Protocol). Servers provide services such as hosting files, storing data and processing requests from clients through APIs (application programming interfaces).

The decentralized web is being funded by a new generation of crypto investors who are looking for long-term value, not just quick returns.

With the advent of blockchain technology, we've seen an explosion of new and innovative ways to do business. The decentralized web is being funded by a new generation of crypto investors who are looking for long-term value, not just quick returns.

We're seeing an increase in funding rounds that look more like traditional VC rounds than ICOs. In fact, it's possible that these companies may even be able to raise money from traditional VCs at some point in the future.

The biggest difference between these two types of funding is that ICOs are usually pre-selling tokens before they've even built a product or service. In some cases, there's no need for them to have a working product because it doesn't actually matter if there's real demand for their product or service — all that matters is that they generate enough hype around their idea so they can sell their tokens before anyone realizes there might not be enough demand for them.

But with traditional VC funding, you get money upfront in exchange for equity or profits down the road — which makes sense because you're investing in something tangible and want to wait until there's evidence that the company is successful before you expect returns on your investment.

New opportunities for startups in web3 include building social platforms, decentralized exchanges, new business models and governance methods.

The world of blockchain technology is changing quickly, and the opportunities for startups are growing by the day.

One of the biggest trends in this space is the emergence of web3 applications, which are built on top of decentralized networks. These applications leverage the power of blockchain technology to decentralize control over data and monetization.

The decentralized nature of these platforms means that users own their data, rather than giving it up to large corporations like Facebook and Google as discussed in the aforementioned.. This also means that web3 companies don't need to pay for server infrastructure or rent office space — everything is done on the blockchain, so there's no need for a headquarters or any other centralized location.

This shift from centralized to decentralized has opened up new opportunities for startups in web3, including building social platforms, decentralized exchanges, new business models and governance methods.

Blockchain technology has already disrupted many industries such as finance and real estate — now it's time for social media too!

Key challenges for enterprises will include implementation of self-sovereign identity and data storage, scalability and regulation.

The blockchain is a disruptive technology that has the potential to transform every industry in the next decade. It’s a decentralized database that stores data in ‘blocks’, which are tamper-proof and cryptographically secure. The blockchain allows for trustless transactions and can be used to create applications that are resistant to fraud, censorship and downtime.

The most prominent use cases for the blockchain today include cryptocurrencies like Bitcoin and Ethereum or tokens such as ZRX (0x Protocol). These currencies rely on the Ethereum blockchain and represent a new type of asset class — one that can be traded or invested in by anyone around the world with an internet connection.

But there are other use cases for blockchain beyond cryptocurrencies. For example, blockchains can be used to store any type of data securely, from medical records to voting results, enabling greater transparency and trust between all parties involved in an interaction.

The rise of immutable blockchains will make it possible to truly track ownership of digital assets like art and music.

Blockchain technology has the potential to change the way we do business in many ways.

The blockchain is a decentralized ledger that can record transactions between two parties efficiently and in a verifiable and permanent way. Since its inception, blockchain technology has been used to track ownership of digital assets like art and music.

This is possible because the blockchain is based on cryptography, meaning that all transactions are recorded in a public ledger where they are visible to everyone, but no one can see your personal information. The use of cryptographic hashes ensures that the data entered into the blockchain cannot be modified or tampered with by anyone once it is committed to the ledger. This makes it possible to track ownership without any central authority or organization having control over it.

For example, if an artist sells a song on iTunes today, Apple has control over who owns what rights when it comes to licensing and royalties for that song. If you purchase a song from iTunes today, you're not really buying it — you're just paying for access to listen to it through Apple's platform until they decide otherwise (which is why some songs disappear from iTunes). With blockchain technology however, you could truly own your music files without having any middlemen taking a cut of your profits or making decisions about what happens when someone listens to your music.

Crypto will be a major influence on the web as we know it today.

Web3 is the new frontier when it comes to cryptocurrency, decentralized applications (dApps), and smart contracts. As this technology continues to grow, very interesting opportunities for startups will appear in the web3 domain. This will create new business models for web3 startups and eventually this technology will be integrated into existing applications by leveraging existing frameworks instead of building your own from scratch. Remember what happened when Facebook launched their platform?

Climate investing is the practice of making investments that reduce global greenhouse emissions while producing profits. Climate investing (or climate-compatible investing) includes investment products such as loans, bonds, stocks and more that give investors an opportunity to earn a positive return by investing in activities that can mitigate or stabilize the effects of global warming.

Where does climate investing go?

Climate investing is a type of socially responsible investing (SRI) that focuses on environmental, social and corporate governance factors.

Climate investing can take many forms, such as investments in renewable energy, energy efficiency, sustainable agriculture or forestry and other climate-related technologies. Some investors may opt to invest directly in companies that are creating these products and services, while others may choose to invest indirectly through investment funds.

In addition to these direct investments, there are many ways to include climate change in your investment portfolio without making a direct investment. For example, you could buy shares in an exchange-traded fund (ETF) or mutual fund that invests in companies involved with renewables or environmental initiatives.

The first step for anyone interested in climate investing is to determine which approach best suits their needs and goals.

Carbon Markets

Carbon markets are one of the most common ways to invest in climate change. They allow companies to buy and sell carbon credits, which are created when companies reduce their emission levels over time. This can be done by investing in renewable energy, planting trees or installing more efficient lighting and appliances.

Investing in carbon markets can be a good way to help companies reduce their carbon footprint and it also provides investors with an opportunity to make money. Carbon credits are traded on exchanges such as the Chicago Climate Exchange, New York Climate Exchange and European Climate Exchange.

One of the main advantages of these types of investments is that they’re relatively easy to understand, even for inexperienced investors. You can easily see how much CO2 was reduced by a particular project which makes it easier for you to evaluate investment opportunities.

What types of investments count as climate investment?

There are many different types of investments that can be made into the climate sector. Some of the most common include:

Renewable energy. This includes wind farms, solar panels and other forms of clean energy generation. These tend to be more stable than fossil fuels and can provide consistent returns over time, although they may be riskier at first as they're still relatively new technologies.

Clean tech. Clean tech includes anything that helps reduce our carbon footprint, such as electric cars and cleaner forms of transport or even technology that reduces our energy use (like smart thermostats). Clean tech companies tend to be less liquid than renewables because there are fewer buyers for their products — but they can be more profitable if demand increases over time.

Public-Private Partnerships (PPPs)

Public-Private Partnerships (PPPs) is a partnership between the government and the private sector to build and operate infrastructure. The private sector takes responsibility for designing, building, financing and operating the project, while the government provides the land and contributes to the upfront capital costs of construction.

PPPs are advantageous to both parties because they allow governments to save money on construction by using private contractors instead of hiring public employees. For example, a state highway department may not have enough money to build a new highway on its own so it turns to a private contractor who can take on this project at a lower cost. In exchange for their services, the contractor receives payments from the state over time as well as other incentives such as tax breaks or tolls on roads they manage.

Climate Finance is a major area of environmental funding.

With billions of dollars flowing into this fast-growing field, it's time we gained a greater understanding of the industry. It has the potential to drastically reduce carbon emissions, and perhaps even contribute to the development of more sustainable practices in other sectors as well. These investments have the power to make a huge difference for our planet, so let's do what we can to ensure that happens.

Software startup jobs have not been easy to come by over the past years. The market is saturated with big established players who have already taken a big share of the pie. So how can new startups survive the fierce competition and make their way to success in the industry that has hundreds of millions of dollars at stake?

Cloud computing’s growth continues, and with it the industry’s ability to provide computing power on an as-needed basis.

Cloud computing is growing at a rapid pace, and that means the technology is becoming more accessible to businesses and individuals alike. In fact, cloud computing has become so popular that there are now over 1,000 different cloud providers worldwide. As a result, there are now over 10 million cloud users in the United States alone.

While this is great news for anyone looking to get started in cloud computing, it also creates a problem: how do you choose between all of these different services? The answer is simple — you don’t have to! Many of these providers offer their services through third-party vendors who can help you find the right solution for your business needs.

Companies are spending more money on bespoke software solutions.

The software industry is still enjoying a period of growth and innovation, but it seems like every month we hear about another company going under.

It makes you wonder: Is the future bleak for software startups?

Well, not quite. While there are some challenges in the market, there are also plenty of opportunities ahead.

Here are four reasons why you should be bullish on software startups 2022:

Companies are spending more money on bespoke software solutions. According to a recent report from IDC, the global spend on custom-built applications will increase by 10% between 2018 and 2022. That represents an annual spend of $7 billion per year. This is good news for companies that focus on developing custom solutions for customers because they won’t have to compete with large vendors who also offer similar services at much lower prices.

Cloud platforms are making it easier than ever to launch your own business. In previous years, entrepreneurs had limited options when it came to launching their own businesses without any prior experience or funding. Today, however, there are many cloud-based platforms that allow anyone to get started without having to worry about setting up physical hardware or managing servers themselves which eases day-to-day business activities.

In a recent survey, 50% of small businesses said they plan to increase their use of SaaS providers in 2021.

In a recent survey, 50% of small businesses said they plan to increase their use of SaaS providers in 2021. That’s up from 44% in 2018 and 39% in 2017.

These are promising numbers for the SaaS industry, but what does it mean for you if you’re an entrepreneur? Let’s take a look at some of the most important trends shaping the SaaS market and what they mean for your business:

More Small Businesses Are Using Software-as-a-Service (SaaS)

The first big trend is that more small businesses are using SaaS than ever before. As we mentioned above, 50% of small businesses plan to increase their use of SaaS providers in 2021. This is significant because it means that more companies will be able to access the latest technologies without having to invest in expensive hardware or software licenses upfront.

Software Is Becoming Invasive — And That’s A Good Thing!

Software has become so pervasive that it’s almost impossible not to use it on a daily basis. There are now over 2 million apps available on Google Play alone! This is a huge feat if you think of the world before apps were even accessible.

The demand for software developers is higher than ever.

The demand for software developers is higher than ever. In fact, the supply of developers is not keeping up with the demand.

There are a few reasons for this. One reason is that there are more jobs than there are people to fill them. Another reason is that there are more opportunities to learn programming than ever before.

One thing that has really helped the growth of software development is the ability to learn how to code online. With places like Udacity, Coursera and others, anyone can learn how to program without ever stepping foot inside an actual classroom.

Not only are people learning how to code online, but they’re also starting their own businesses as well. This has made it easier for anyone to become an entrepreneur and build their own business from home if they want to do so.

Another trend that has helped drive up demand for software developers is the rise of artificial intelligence (AI). AI has been around for awhile now, but it’s only recently been making its way into businesses and our everyday lives in a big way because of all the advances in technology over the last few years including cloud computing and big data analytics among other things which have made it possible for businesses to use AI technology more effectively in every aspect of their business.

Tech companies with a remote model have an advantage at recruiting top talent.

“I think it’s definitely the future of work,” says Michael Prager, CEO of mobile app development company Appetizer Mobile. “I think you’ll see more and more companies going remote as we go forward.”

Tech companies with a remote model have an advantage at recruiting top talent

Remote work is a powerful tool for attracting top talent. It also allows companies to hire people from anywhere in the world. With the rise of remote work and freelancing, there are more opportunities than ever for software startups to find world-class candidates. “I think it’s definitely the future of work,” says Michael Prager, CEO of mobile app development company Appetizer Mobile. “I think you’ll see more and more companies going remote as we go forward.”

Software startups can carve out their place by using a freemium model.

It’s not all doom and gloom for the software startup industry.

With the rise of open source software and new approaches to cloud computing, there are still opportunities for startups to carve out their niche.

Freemium model: Software startups can use a freemium model to grow their customer base and then charge customers for premium features once they have established themselves. This is particularly useful if you are creating a platform which can be used by multiple users or businesses.

Open source software: Open source software is free to download and use, but it’s often not compatible with proprietary systems. This makes it difficult for businesses who want to go down the open source route. However, some companies have made huge amounts of money from selling support services on top of open source products like Linux, so it is possible to make money from open source software.

Cloud computing: Cloud computing allows users access to applications through the internet without having to install them on their own computers. This allows developers who want to create software as an app rather than a website to develop applications without needing expensive server hardware or maintenance staff.

Volatility pushes growth stocks higher.

One of the ways that investors can take advantage of volatility is by buying growth stocks on dips. When stocks fall in value due to a major event or news story that impacts their business model or outlook, investors often sell their shares because they think they won’t recover their losses anytime soon — even if they have strong fundamentals or long-term prospects. That creates buying opportunities for investors who believe that those companies will continue growing despite short-term losses.

These days there are plenty of stocks trading at depressed prices that are worth looking into if you want exposure to growth stocks without taking too much effort.

Businesses are increasingly moving to a subscription model as a way to smooth out revenue and cut costs from building and maintaining hardware platforms.

There are more than 2 million active software companies in the U.S., according to data from the National Venture Capital Association (NVCA). And nearly half of them — 1,300 — have less than 10 employees.

It’s a growth industry, with VC funding climbing more than 10% annually over the past five years. Overall, venture capitalists invested $19 billion into software startups 2022 last year alone, with 9% of that amount coming from early-stage rounds.

While some industries are struggling, software startups 2022 are finding new ways to adapt to market conditions and ride trends like cloud computing and the move away from hardware platforms.

Businesses are increasingly moving to a subscription model as a way to smooth out revenue and cut costs from building and maintaining hardware platforms. Software as a service (SaaS) is expected to reach $145 billion by 2023, up from $75 billion in 2018, according to Gartner Inc., which forecasts that SaaS spending will grow at an average annual rate of 10% through 2023.

Software startups can thrive in 2022 by taking advantage of trends in cloud technology, developer recruitment and company spending habits.

Software startups do not need to be perpetually in start-up mode. For example, developing a core product — not just an MVP — can lead to improved customer acquisition. Moreover, there are ways for software startups to be more successful in today’s market by using cutting-edge Analytics for insights about customer spending habits and cloud technology. The benefits of cloud technology can streamline data storage needs and boost collaborative efforts amongst small teams. These are some of the trends that will help software startups successfully take off during the next five years.

Where will venture capitalists be going next?That's a tough question right now. If you're an entrepreneur, you need to know the answer. After all, can you really expect them to keep throwing money at companies that aren't promising growth? The global economy is in the midst of a dramatic shift. At the same time as it's become easier to start a company (and more people are doing so), traditional investment opportunities are drying up. So what's the answer? Whether we like it or not, the future is in alternative investments and growth businesses.

In 2022, the healthcare industry will be more than twice as valuable as the next most valuable industry.

The healthcare industry has been a target for venture investors for some time now. Over the past five years, VCs have poured $2 billion into healthcare startups in Europe and $6 billion in North America. That's in addition to the $1 billion invested by pharma companies and the $20 billion spent by insurance companies on new drugs and medical devices each year.

But it's not just about money — it's also about time. As of 2022, there will be an estimated 57 million people in Europe over 65 years old and 22 million over 80 years old. These are huge numbers — especially when you consider that there were only 14 million people over 65 in 2010. This rapid increase is driven by two factors: longer life expectancy and lower birth rates.

The most valuable startups after healthcare will be in cybersecurity and AI software.

As we enter the second decade of the 21st century, it is clear that technology is changing the world as we know it. From internet banking to self-driving cars, technology is transforming every aspect of our lives. In fact, according to a report from Goldman Sachs, there are over 1 million jobs related to artificial intelligence (AI) software alone.

As a result of this rapid change, venture capitalists are looking beyond traditional industries like healthcare, finance and energy toward new areas of investment such as cybersecurity and AI software. These emerging technologies could be worth trillions of dollars by 2030 and have the potential to disrupt many industries.

Next will come infrastructure and robotics, with the latter driving a new generation of industrial expansion.

Robots are already replacing humans in factories, but their use is still limited to repetitive, predictable tasks. That's about to change as artificial intelligence (AI) and machine learning (ML) get smarter and more capable.

The first generation of AI is focused on replacing human knowledge with machine intelligence — think Siri, Alexa and Cortana. The second phase will allow robots to learn from their environment and adjust their behavior accordingly. For example, a self-driving car can learn how to drive on its own but still needs a human to tell it when it makes a mistake or react appropriately to unexpected events like pedestrians or other vehicles.

The third phase of AI will combine ML with autonomous systems so that robots can learn from experience without human intervention — think self-driving cars that can change lanes or avoid obstacles without being told what to do.

A massive (albeit belated) industrialization of China is already well underway.

In 2022, venture capitalists will look to China for the next big thing. The country has spent the last decade transitioning from a manufacturing economy to an innovation economy, and investors are starting to notice.

But it's not just the size of the market that makes China attractive. Chinese entrepreneurs are hungry for new ideas and technologies, and they're willing to take risks on untested startups. That's why U.S.-based companies like Uber and Airbnb have been so successful there: They've been able to adapt their products to fit local needs and preferences more easily than if they'd tried doing it from scratch in Silicon Valley or New York City.

Most importantly, investors are finding that Chinese entrepreneurs are willing to work with them in ways that don't happen in Western countries. In the U.S., for example, a lot of innovation happens at universities funded by government grants or nonprofit organizations like the National Science Foundation (NSF). But there's no equivalent "universities" in China — yet — so many researchers end up working for large corporations instead of universities or nonprofits; this makes it harder for them to collaborate with industry partners than it would be in the U.S.

Venture capitalists will have to look outside of silicon valley to find the next big startups.

As the world becomes more and more interconnected, technological innovations will begin to spill over into every corner of our lives. Perhaps one of the most exciting places for tech development is in augmented reality, and it will be exciting to see where venture capitalists decide to pour their money after 2022.

The arrival of a new crop of internet giants and the explosion of tech-focused venture capital are pushing some startups to spend money at a breakneck pace, while others go to great lengths to save.

It's easy to get lost in the numbers when talking about how much money your favorite startup is burning through.

New York-based media company BuzzFeed, for example, recorded $370 million in revenue last year and has raised more than $1 billion in venture capital. In its most recent quarter, BuzzFeed spent $40 million on "content rights," which includes things like paying people to create original content (like lists) and licensing clips from other companies (like viral videos). It also spent $11 million on research and development, or R&D — a big jump from the previous year.

At the same time, BuzzFeed CEO Jonah Peretti told investors last month that his company was spending less on technology than it was a year ago because it had built up enough infrastructure to run efficiently. And he said BuzzFeed would likely spend less money on R&D going forward as well because it already has plenty of tools in place for its employees to use.

The dichotomy of BuzzFeed's spending habits is hardly unique among startups these days: The high cost of talent combined with low interest rates for borrowing has led many young businesses to spend freely as they grow into profitable companies. At the same time, though, some startups are watching every penny as they try to conserve cash so they can survive the tough unforeseen market fluctuations.

Both approaches are creating winners and losers, with implications for the broader economy.

The number of young companies with more than $1 billion in revenue is tiny. Just one has reached the milestone in the last five years: Uber, which became a public company in May 2019.

But there are many more startups that have raised money at valuations that exceed $1 billion. These companies are flush with cash and watching every penny.

The two approaches are creating winners and losers, with implications for the broader economy.

The winners: Investors who have poured billions of dollars into private companies have been rewarded by their investments in Lyft Inc., Slack Technologies Inc., Pinterest Inc. and other high-flying startups that have become publicly traded companies within months of going public.

The losers: Startups that failed to attract funding from big investors — or couldn't raise enough cash — are being forced out of business by ever-higher rents, health care costs and other expenses required to run a business but not covered by their leaner balance sheets. Some say it's almost impossible for them to compete with larger rivals that can afford to pay more for talent and services.

"It feels like there is an arms race among startups," said Steve Berkenbush, chairman of the startup advocacy group Startup Colorado and chief executive officer at Bizness Apps Inc., which develops software for small businesses to easily create, edit, and manage an iPhone app online without any programming knowledge needed.

Most startups today have access to far more cash than they did a decade ago, allowing them to invest in technology, hire a large staff or develop products and services quickly.

In the early years of the internet boom, startups were often forced to make do with limited resources.

"When I started my first company in 1999, we had a budget of $50 million and it was a huge amount of money," says Michael Lazerow, co-founder and CEO of PPC agency MediaPlant. "Nowadays, startups can raise $50 million or more in venture funding with no real product."

Today's startups have access to far more cash than they did a decade ago, allowing them to invest in technology, hire a large staff or develop products and services quickly. But the influx of money has also made it easier for companies to burn through their cash reserves without generating much revenue — or any at all.

"It's very easy for startups to get into trouble because there is so much money available," says Lazerow. "The key is knowing how much you need at each stage of development and then raising just enough."

That dynamic has helped fuel rapid growth in the number of new companies, jobs and economic output from some sectors.

One of the biggest trends in the U.S. economy over the last decade has been the rise of startups.

The number of new companies, jobs and economic output from some sectors has grown faster than the overall economy. There are now more than 20 million private companies in the U.S., compared with 3.5 million in 1997, according to Census Bureau data. And venture capital funding of new companies hit a record $174 billion last year—the most since 2000—according to PricewaterhouseCoopers and NVCA Venture Monitor report.

That dynamic has helped fuel rapid growth in the number of new companies, jobs and economic output from some sectors, such as software development and business services. But it also has contributed to rising inequality by concentrating wealth among a small group of investors who back those new companies.

"There is a lot more money chasing fewer deals," said Mark Suster, an entrepreneur-turned-venture capitalist at Upfront Ventures in Los Angeles. "That means we're going to see fewer unicorns."

Many startup founders say they never want to be dependent on banks for loans or investors for funding again.

It's been quite a few years since the financial crisis, but many startup founders say they never want to be dependent on banks for loans or investors for funding again. They're building their businesses with their own money and keeping their expenses low.

"I think you'll see a lot more of this," said Paul Graham, co-founder of Y Combinator, which invests in startups and is a bellwether for the tech industry. "People are realizing that it's not just about raising money from VCs, it's about how to make it work without them."

The mindset is spreading rapidly among entrepreneurs who have built companies with little or no outside financing. It's also becoming more common among bigger companies like Google, which has adopted a philosophy called "don't be evil" that has become a rallying cry for the growing community of entrepreneurs who believe that profit isn't everything.

"It's an incredibly powerful idea," said David Cohen, chief executive officer of e-commerce company TechStyle Fashion Group Inc., which has grown by reinvesting profits rather than taking on debt or selling shares. "You can build an incredible business without diluting control or giving away any equity."

This is not to say that startups are penny-pinching. After all, these businesses often have millions in funding from angel investors and venture capital funds. The point is simply that startups are becoming increasingly aware of the importance of controlling their costs, especially at this early stage of their growth cycle. They know that every penny saved today could make a difference down the road, once they reach maturity and begin to generate revenue. Not to mention that startups are competing with each other for a limited market pool. In short, startups can no longer be as reckless with their spending habits as they may have been before, because there are now more smart businesses vying for success than ever before.