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I love the idea that something has changed in the world of startups. That somehow, today, you actually have to worry about arcane ideas like profitability, gross margins, and financial management. Oh, the horror!
Even more to the point, I just don’t get why so many people are acting like the world is over because you’ll actually have to manage your startup properly? Give me a break!
In 2016, I wrote an article titled, “Why You Should Ignore The Rise Of The Unicorns”. In this article, I argued that Unicorns were really a Venture Capital backed Ponzi Scheme in disguise.
Well, it took over six years to show that I was right. Look at what’s happened to Unicorns. These startups, that were valued at greater than $1 billion, are having trouble raising their next round of funding. Those lucky enough to raise funding saw their valuations, according to leading Silicon Valley law firm Cooley Godward, drop by 85 percent.
Ouch.
Venture capital cycles are predictable.
This is the third major startup crash I’ve lived through. The first was the Communications Bubble of the late 1990s. Then there was the 2008 Great Recession, and now we have today’s Unicorn Bubble.
