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We're in a VC bubble. Tons of ideas are getting funded that have virtually no likelihood of producing any return. I would guess that this bubble will fizzle ra
by twobyfour 9y ago
We're in a VC bubble. Tons of ideas are getting funded that have virtually no likelihood of producing any return.
I would guess that this bubble will fizzle rather than pop. When the pop begins, the VCs themselves will rather abruptly find it difficult to raise money for their next funds.
This will make it far more difficult for startups to raise or re-raise, but there won't be a sudden mass extinction. We'll see many fewer getting off the ground; and those that have already raised seed or series A will for the most part spend out their runway and then die quietly.
Unlike in the first dot-com bubble, nearly all startups in this wave have customers other than other startups, so we'll see some companies struggle but less of a domino effect.
- aglionby 9y agoMy go-to example for this is Yik Yak, which raised >$70 million before introducing features that drove their users away. I don't understand how that much money could be justified given the feature set of the app, though I'm inevitably underestimating the cost of scaling.
- tudelo 9y agoThey had something good while it lasted. On college campuses, it essentially functioned as an open chatroom for large classes. Of course, most of the fun was at the expense of the professor. That and random trolling.
- dabockster 9y agoBeing connected to every college campus in America with minimal friction? Yeah that's worth $70 million.