After years of funneling cash into startups’ grand ambitions, Silicon Valley’s SIVB 4.00% investors are engaging in the grim ritual of delivering survival advice to their portfolio companies. In recent online slide presentations, blog posts and social-media threads, venture-capital doyens including Lightspeed Venture Partners, Craft Ventures, Sequoia Capital and Y Combinator are telling the founders that they need to take emergency action for what could be the sharpest turn in more than a decade. Their advice includes cutting costs, preserving cash and jettisoning hopes that hedge funds or other investors will swoop in with big checks. The investors’ admonitions are a departure from the growth-above-all mantra for startups in recent years, and come as the venture market is showing signs of sputtering. Funding for global startups—at around $58 billion in commitments midway through the second quarter—is on pace to drop by about one-fifth in the period compared with the previous quarter, according to analytics firm CB Insights. The tech-heavy Nasdaq Composite Index is down about 25% from its all-time high in November, and SoftBank Group Corp. , which has poured more than $100 billion into investments, this month reported a $26.2 billion loss in the first quarter as valuations plummeted in its portfolio of tech companies. Startup investors have sounded alarm bells in previous moments of financial and economic tumult, including the start of the Covid-19 pandemic. But partners at venture funds say the current situation is different. In past downturns, the Federal Reserve cut rates and pumped money into markets to support the economy, providing liquidity and cheap capital. This time, the central bank has been raising rates and taking money out of the system in a bid to tame inflation. The Fed’s moves are making capital more expensive, and increasing the pressure on companies to preserve their cash. Sequoia, one of Silicon Valley’s most storied firms, warned founders and CEOs in a March 2020 memo about the risks to businesses from the looming global health crisis, including supply-chain issues and canceled travel. The latest presentation mirrors the message in a 50-slide presentation Sequoia sent to founders in October 2008, saying a housing-led recession and overleveraged financials—which it illustrated with a butchered carcass and a gravestone—meant that companies needed to control spending, focus on quality and lower risk. Some big deals are still getting done. Space Exploration Technologies Corp., or SpaceX, Elon Musk’s rocket company, just raised a fresh round of upward of $1.5 billion in funding, for instance. And many startups stockpiled enough cash from the gusher of fundraising last year to continue operating for several more years on existing funds, said Neeraj Agrawal, a general partner at Boston-based Battery Ventures.