Startup Valuations

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The bigger story behind big valuations

The New York Times notes that big-money rounds are becoming all too routine in Techlandia, which has led some to wonder: what is the cause of this seemingly irrational exuberance? Valuation, in the end, is determined by an investor’s willingness to suspend belief — or rather how much they want to suspend that belief. There are others who are jumping in after seeing others make a killing. There is a herd-like behavior, and when that happens valuations take a leap.

But focusing on the shifting valuation and check sizes, we are missing the point: the planet as we know it is going through some seismic changes, and such changes mean opportunity — to create, disrupt and re-invent. So let’s talk about the shift. Continue reading “The bigger story behind big valuations”

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Are top US startups really startups?

Pitchbook, a data research company has come up with a list of top 14 most valuable startups in the United States. There are no real surprises — they are all ranked by valuation and they all are valued at north of $4 billion. They are all household names – barring Outcome Health and Samumed.

And they have been around forever. They have thousands of employees and many have billions in revenue. What they are not is liquid on public markets. They have not IPO’d. In a different Silicon Valley, they will all be public companies and they won’t be deemed startups. Revenue, growth, relative size, market share – pick a metric (except for lack of profits in many cases) and you know they aren’t really startups.

So can we stop calling them startups — and instead maybe call them VC-backed private companies — otherwise the label startup loses its meaning. Continue reading “Are top US startups really startups?”