Valuations did not mean that the stock market bubble technology industries but still need to be alert
When the technology bubble for the first time, a lot of nothing but still get the sky-high valuations of startups, disappeared over night. Since then, investors have always been wary of technology companies. However, if you call a “bubble” refers to the stock-market bubble, so certainly not a bubble in the tech industry.
But this does not change the entrepreneurial company award funds favor reality, they were really big money opened its sky-high compensation to employees, while others are under such Government rent luxury office building in San Francisco.
“There are many incomprehensible things. “Managing partner of venture capital firm Andreessen Horowitz sikete·Ku Cooper (Scott Kupor) says,” I’m sure there are some valuations are scratching their heads: ‘ Gosh, I really don’t know how to calculate the number of people. ’”
Compared with the peak of the Internet bubble in 2000, 2014 difference lies in the way these funds into the business. Huge capital (including institutional investors and sovereign wealth funds) want to reap the returns environment where interest rates are close to zero. They found that one approach might be to rush in pre-IPO, taking stakes in their early stages of development. Uber this sky-high valuations for companies (valued at around US $ 40 billion), this way, you can simply explain the underlying reasons.
The traditional model of venture capital are: limited partners convert all money to venture capitalists, hoping to profit from the expertise of the latter.
Now, everyone seems to think they are experts, can accurately determine which technology companies have value and worth. Cooper said that traditional venture capital exits will be huge revenue to make up for the losses they suffer most projects. But now big institutional investors were willing to accept slightly higher than the investment returns of the stock market. Because of this, leading to a surge of funds.
As the Upfront venture capitalists Ventures make·susite (Mark Suster) in July this year, said in the blog, hedge funds, mutual funds, and even large corporations are pre-IPO investments, so as to expand the funding of startups, the traditional venture capital squeeze.
Small investors to invest in the seed round in this game. Thanks to United States startups of the support provisions of the Act, these trends are likely to accelerate because the Act allows all persons involved in the startup of early-stage financing.
Many entrepreneurs believe that financing is required to jump on competitors by taking market elements, because they all are scrambling to build brand awareness, competing for tiny mobile phone home screen. But it also means that, even if they get a huge amount of revenue, there will be still loss-making, because they have to use their money to take share. This is the maximum difference in 2014 with 2000.
In fact, other aspects are also reflected in the differences in two periods: nowadays, almost all businesses have insisted that if they want to make money, anytime. They say to themselves and their investors, according to “economic units”, they are not every trade is losing money. But they are losing money in other areas, including sales and marketing costs as well as capital expenditure.
“Certainly now chasing growth. “Venture capital firm Accel Partners bulaien·aomali (Brian O’Malley) said that” growth is not blind, they really care about data, but growth was the most important factor. ”
This is where I questioned. Every tech company I can think of, from the “sharing economy” giant Uber and Airbnb, Hortonworks (data) and Lending Club (P2P financing) of business and financial technology companies, are faced with the failure of their current valuations may be threatened. These threats include regulatory and competitive, but one of the biggest ever is no different: is there enough people or businesses willing to buy their products or services.
Some of these companies rely on market are even shrinking, such as office lease WeWork startups.
Many of them may be in 2015, IPO.Box, Uber and dozens of other companies are looking at IPO, or experiencing a similar rumors. According to the Dow Jones venture resource statistics, United States pre-IPO private companies valued at more than $ 1 billion to a record 48. Minorities will be acquisition of listed companies, but many must eventually return to shareholders through the IPO.
Bull would eventually turn to bear. “Dr doom,” said economist luliaier·lubini (Nouriel Roubini) predicted that this might happen in the year 2016. He said in an interview with Yahoo Finance, the impact on stocks of tech and social media will be particularly great.
But on the other hand, almost all investors have identified technology startups that will create lasting value, think they can survive the economic downturn–or, at least pre-IPO investors liquidated before the recession comes out.
Not that I don’t believe this revolutionary technology company’s early investors. I agree that the social theorist Jeremy Rifkin (Jeremy Rifkin) point of view, he argues that we are in the “third industrial revolution”, which are the Foundation of the company. But I’m not sure these pre-IPO investors ‘ short-term interests, whether those will eventually get rid of the company’s “stupid money” investors.
Because of this, I urgently appeal to all concerned people in the company, at any stage should be on the alert. Now, we can often hear a startup discussions can draw level with similar enterprises, including revenues and expenses. However, these indicators are derived from an overheated market. Once the market starts correction, first is exaggerating the market’s companies.