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> Critically though it isn't retail investors who would bear the cost of a failure, that would be born by the folks like Softbank and the hedge funds who have i
by richardknop 8y ago
> Critically though it isn't retail investors who would bear the cost of a failure, that would be born by the folks like Softbank and the hedge funds who have invested.
This is highly optimistic. A failure of a big startup such as Uber could easily start a chain reaction, failure of other similar big unicorns, perhaps steep losses in stock market, spreading panic etc. It could easily could get to a point when government bails out the investors and banks in some way, just so they don't lose money. This is more likely scenario in my case.
- philipodonnell 8y agoNah. The irony is that while staying private, being combative with governments and relying on independent contractors to operate their business allowed them to reach this size, it also prevents them from having any leverage to ask for a bailout. No jobs to save. No retail investors to protect. No switching costs. No feel-good story for a politician to get behind. If Uber fails it'll get parceled up by the remaining players in a heartbeat, either by selling parts of itself (at best) or everyone just switching.