The influx of capital during ZIRP caused many venture capital funds and family offices to dramatically increase their investment rates, as they had more money to manage and distribute.

Once interest rates began to rise again, many investors who had entered the startup space during ZIRP exited quickly, leaving behind a volatile market.

When startups received large amounts of funding during ZIRP, it often led to a lack of innovation, as companies began to rely on spending more money rather than improving their products or services.

There were three types of venture capitalists during the zero interest rate period: those who believed there was no problem, those who knew it was problematic but participated anyway, and a small group that chose to hold onto their capital.

The ZIRP environment created a false sense of security for many founders, who believed that simply having access to capital would ensure their success, ignoring the need for sustainable business models.

ZIRP, or Zero Interest Rate Policy, refers to the period when the Federal Reserve set interest rates around 0%, allowing banks to borrow money at almost no cost.

The 1980s saw a boom in venture capital, driven by increased institutional investment and the realization of high returns in the sector.

The ZIRP era saw an explosion of unicorns, with companies achieving billion-dollar valuations at an unprecedented rate, which diluted the rarity of such valuations.

The Federal Reserve shifted from cutting interest rates to zero and injecting significant stimulus into the economy, which created challenges for investment behavior.