# Dodo Digest: The Missing Startups Nobody Is Talking About > Despite the AI boom, the population of active seed-stage startups is shrinking as capital concentrates into fewer companies. The barrier is no longer building, it's monetizing. That's why we launched Dodo for Startups, plus a Builder Spotlight on PeerPush. - **Author**: Rishabh Goel - **Published**: 2026-06-25 - **Category**: Newsletter - **URL**: https://dodopayments.com/blogs/newsletter-june25 --- ## The Missing Startups Nobody Is Talking About ### TL;DR - Despite the AI boom, the total population of active seed-stage startups appears to be shrinking. - More startups are exiting the system than new seed companies are replacing. - Capital is becoming increasingly concentrated into fewer companies and fewer categories. - That creates challenges for founders, but also opportunities for teams willing to build outside the spotlight. - We launched [Dodo for Startups](https://dodopayments.com/startups) to help early-stage founders sell globally without building payments infrastructure from scratch. ## Hello everyone, I came across an interesting piece this week that challenged a lot of the narratives we hear about startups. If you only followed headlines, you'd probably assume we're living through a startup renaissance. Every week there's another AI company raising millions. Another agent startup launching. Another founder announcing a round. But when you zoom out, the picture looks surprisingly different. According to an analysis by Nnamdi Iregbulem, the total population of active seed-stage startups appears to be shrinking, even in the middle of the AI boom. That sounds counterintuitive. But the data tells an interesting story. ## The Signal For years, the startup ecosystem operated like a funnel. New seed companies entered at the bottom. Some graduated to Series A. Many failed. But enough new companies entered the system to keep the overall population growing. That dynamic appears to have changed. The analysis suggests that active seed-stage startups peaked around Q3 2022 and have been declining since. New seed financings are no longer fully offsetting the number of companies graduating, shutting down, or being acquired. The AI boom hasn't eliminated startup activity, it has concentrated it. More capital is flowing into a smaller number of companies. And a smaller number of themes. Chart showing the year-over-year contraction in the number of active and total VC firms from 2015 to 2025 ## What This Means For Builders One interpretation is pessimistic. Funding is harder. Investors are more selective. The risk appetite that once supported unconventional ideas has narrowed. But there's another way to look at it. Some of the most interesting companies today aren't being built because capital is abundant. They're being built because small teams can now accomplish things that previously required entire organizations. AI has dramatically lowered the cost of building. A two-person team today can often move faster than a twenty-person team could a few years ago. The bottleneck is no longer building. It's monetizing. ## Where Things Get Interesting Over the last year, we've spoken with thousands of founders across the world. And a recurring pattern keeps showing up. Despite funding becoming more concentrated, people haven't stopped building. In many ways, they've become less dependent on funding altogether. AI has dramatically reduced the cost of launching a software business. A small team today can build products that would have required entire engineering teams just a few years ago. Founders are shipping faster, validating ideas earlier, and reaching customers with far less capital than before. That's one of the reasons we're seeing more builders choose to bootstrap. Instead of relying on venture funding to fuel growth, they're increasingly funding growth through revenue. The challenge isn't always building the product anymore. It's monetizing it quickly and efficiently. As soon as founders want to start charging customers, a different set of problems begins to appear. Suddenly they find themselves figuring out: - Subscription billing - Credit/Token/Usage-based pricing - Payment recovery and failed renewals - Checkout conversion - Multi-currency payments - Local payment methods - Selling across different markets None of which helps them build a better product. But all of which becomes critical the moment they want to turn users into paying customers. In many ways, Dodo Payments is playing a quiet role in this shift. The next generation of startups won't be defined by how much capital they raise. They'll be defined by how quickly they can turn products into revenue. That's why we built Dodo: to remove the complexity between building something people love and getting paid for it. Because none of these challenges help founders build a better product, but all of them become critical the moment they want to turn users into customers. ## How To Think About This If you're an early-stage founder today: 1. **Don't confuse funding availability with opportunity.** Some of the biggest businesses of the next decade will be built outside today's funding spotlight. 2. **Focus on speed, not size.** Small teams have never had more leverage than they do today. 3. **Build for global markets earlier.** The internet doesn't care where your company is based. Your customers certainly don't. 4. **Remove operational distractions quickly.** Every hour spent managing infrastructure is an hour not spent improving your product. 5. **Optimize for revenue, not fundraising.** The strongest position in today's market is often having customers, not term sheets. ## What We Shipped This shift is one of the reasons we launched [Dodo for Startups](https://dodopayments.com/startups). Over the last year, we've worked with more than 60,000 builders and founders across 220+ countries. And we kept hearing the same story. The product wasn't the problem. Global monetization was. That's why Dodo for Startups gives founders: - Up to 12 months of startup credits - Forever startup pricing - Global tax and compliance handling - Chargeback and fraud protection - Access to the full Dodo platform - The ability to sell into 220+ countries from day one The goal is simple. We handle global tax, compliance, chargebacks, and fraud, so a two-person team can monetize in 220+ countries from day one. Dodo Payments for Startups is now live, offering free credits, preferential pricing, and full platform access ## Builder Spotlight One company I've enjoyed watching recently is [PeerPush](https://dodopayments.com/case-studies/peerpush). They're building an AI-native product discovery platform that helps startups and software companies get discovered by both users and AI systems. As more people turn to tools like ChatGPT and Perplexity to find products and recommendations, helping companies stay visible in those environments is becoming increasingly important. As their platform expanded across different markets, they needed a payment setup that could scale with them without creating additional operational overhead. That's where Dodo came in. Instead of spending time navigating tax compliance, global payments, and cross-border regulations, they could stay focused on what they do best: helping great products get discovered. It's always exciting to see builders helping other builders grow, and we're happy to be powering payments for them as they scale. PeerPush, an AI-native product discovery platform, showing its homepage and product listings ## One Last Thought The startup ecosystem may be getting smaller. But that doesn't necessarily mean opportunity is disappearing. In many ways, the opposite may be true. The barriers to building have never been lower. The challenge isn't creating software anymore. It's turning software into a business. And the founders who figure that out will have an advantage regardless of what the funding market looks like. Also, join our loving [Discord community](https://discord.gg/dodo-payments-1305511580854779984)! Best, **Rishabh Goel** **Co-Founder, Dodo Payments** --- - [More Newsletter articles](https://dodopayments.com/blogs/category/newsletter) - [All articles](https://dodopayments.com/blogs)