Your dealmaking predictions for 2021

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I asked you dear readers for your predictions for 2021, and OMG did y’all have predictions. I thought I knew what I was getting myself into—I was wrong. Now my inbox may need a digital retreat.

The tl;dr: Many of you believe the long-term impact of the pandemic won’t die off but that its effects have been overstated. While consumers are likely to have formed permanent habits that boost e-commerce, grocery delivery, and healthcare tech, you still expect our pre-pandemic behavior to return—to an extent. You also predict a greater focus on addressing the wealth gap.

What’s also telling is what you don’t say: For 2020, readers predicted a recession. That word hasn’t made an appearance this time around. Instead, many of you are expecting valuations for some of the software and productivity companies to come back down to a “healthy” point.

Here’s an excerpt of your predictions. You can read many more here.

It’s not the end of Silicon Valley: “Silicon Valley will continue to be at the top of the totem pole in terms of innovation, but we will also see a distribution of capital, talent and entrepreneurship in other cities as well, which is clearly a great thing. In the same way that Utah is a hub for SaaS companies, Seattle for travel and real estate, or New York for fintech, we will see micro communities emerge across the country.” –  Pete Flint, General Partner, NFX

Valuations come down: “As we return from the pandemic and there is rotation of dollars from tech to travel, hospitality and energy sectors hurt by the pandemic, we will see 2021 multiples return to normal yet healthy levels (20-25x forward revenues).” – Dharmesh Thakker, General Partner, Battery Ventures

Offices come back: “The death of office culture and the allure of remote working has been massively overstated. Sure, we want to hang onto some flexibility; but employees at companies of all sizes that have been remote this year are hungering for the connection of their peers and longing to feel the togetherness that’s borne from a shared mission.” – Nicole Johnson, partner, Forerunner Ventures

Some very specific deals could be made or fall through: “DoorDash falls below $100 by July.” – Jerry Chen

“Microsoft buys Akami.” – Bill Mahoney

“Google Cloud, Microsoft or Vmware will acquire Hashi in 2021. Another large acquisition would be Google Cloud acquires Confluent. There’s going to be a wave of acquisitions in the security space. Many tuck-in acquisitions by Crowdstrike, Palo Alto, Zscaler.” – Baris Aksoy

Read more.

And it will be another robust year for IPOs: So many of you predicted this, and that forecast is looking mighty promising. Cryptocurrency marketplace Coinbase says it has filed confidentially for an IPO. As has buzzy software and automation startup UiPath. And the now profitable secondhand clothing marketplace Poshmark has also revealed its IPO prospectus.

HOUSEKEEPING: Due to the Gmail outage three days earlier, some Gmail-based readers may not have received Term Sheet in recent days. You can find those versions of the newsletter here

That said, we will be off until January 4. See you next year!

Lucinda Shen
Twitter: @shenlucinda

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