The Fed no longer predicts a recession. Economic data is turning more positive, eg housing starts exceeded forecasts. 80% of public companies beating earnings estimates – three percentage points higher than the 5 year average.

On the other hand, enough uncertainty permeates the market to depress prices. Public software companies’ share prices have fallen 10% on average in the last 30 days dotted with positive notes like the stabilization cloud growth rates for Microsoft & Google.

This is the moment startups with big balance sheets’ advantage will shine.

Efficiency has been the watchword for the last 3-4 quarters. Most companies have trimmed excess costs to drive go to market sales efficiency & burn ratios.

For those companies with hundreds of millions on the balance sheet, they have two strategic options to evaluate.

First, acquisitions. Many startups will look to raise starting in September. The fundraising market, while active, isn’t fully thawed. The metrics for Series As remain unclear, which provides an opening for selective technology & team acquisitions at reasonable prices.

Second, scaling the marketing, then the sales spending as unit economics justify. Startups with bigger balance sheets will be able to ramp much more quickly than those needing to raise capital before scaling the GTM once more. Responding faster to market pull will increase their market share.

The right strategic bet on either of these options can provide a startup with significant advantage into this next economic cycle.