The availability of venture capital in Silicon Valley greatly impacted the power dynamics between Venture Capitalists and founders. The success of companies like Facebook, Google, Instagram, and Snapchat attracted a flood of venture capital into Silicon Valley. This abundance of funding options shifted the balance of power from Venture Capitalists to founders. Founders now had more options to choose from when seeking funding, which gave them more leverage in negotiations. They could negotiate for better terms, retain more control over their companies, and were less dependent on any single investor.
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In 2008, it was a perfect time to launch Uber. 75% of American households had computers with internet access, and Amazon Web Services had dramatically reduced the infrastructural costs involved to launch a company. Finally, the iPhone and the App store made software distribution to millions of users nearly effortless. Fuelled by the success of Facebook, Google, Instagram and Snapchat, venture capital flooded Silicon Valley and shifted the balance of power from Venture Capitalists to founders.
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