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> "Point is the media is making this out to be an indictment on some SV tech bubble" Its not the media, I think its just true. Had WeWork IPO'ed under the sam
by autokad 7y ago
> "Point is the media is making this out to be an indictment on some SV tech bubble"
Its not the media, I think its just true. Had WeWork IPO'ed under the same conditions a year ago, I think it would have been 'fine'. but the glut of SV unicorns losing money, hating investors, and slowing growth has got people highly concerned.
This list of companies (slack, lyft, Uber, Pinterest, beyond meat, crowdstrike, tesla, spotify, Pinduoduo, Dropbox, Snap, Domo, Blue Apron, Box, Shopify, Zillow) has 310 billion in market cap and -18.67 billion $ in revenue (back of the envelope calculation).
If I missed anyone or made a typeo/mistake, let me know
how I came up with the numbers:
https://docs.google.com/spreadsheets/d/1L2ElCY853kgWACC3Q48QS9Cdlc3kuczLdkbEESjLILA/edit?usp=sharing https://docs.google.com/spreadsheets/d/1L2ElCY853kgWACC3Q48Q...
EDIT: I am not saying all these companies are bad; I am invested in some of them! Just that the sheer size of these companies and their total losses are unnerving lots of people to such a point that the market had no appetite for WeWork.
- hn_throwaway_99 7y agoMaybe you need to flip that envelope around because I don't know how you get that much negative revenue.
- autokad 7y agoadded link above
- hn_throwaway_99 7y agoRevenue and earnings are not the same thing.
- deleted 7y ago[deleted]
- brennebeck 7y agoNot to be flip, but pretty sure the gp is referring to losses, I.e. burning vc money and not earning enough revenue to break even.
- troquerre 7y agoYou're missing Zoom, Pagerduty, and Cloudflare which are all doing phenomenally well.
- autokad 7y agoThanks, didnt have earnings per share on cloudfare so skipped it
- rsynnott 7y agoA cynic might note that they're essentially selling pickaxes in the gold rush, so would be expected to do well in a tech bubble, even when their customers aren't :)
- icedchai 7y agoPagerduty's stock is in the toilet. Almost anyone who has bought in the past 5 months has lost money.
- ummonk 7y agoSome of those (e.g. Slack) are growing phenomenally fast though, and could become profitable quite easily. Others (e.g. Uber and Lyft) have a questionable business model. Edit: wow I didn't realize Slack had such a large market cap. That is a LOT of growth priced in, probably more than is justified.
- bakuninsbart 7y agoWhile this is true, I seem to miss what makes Slack special. We use it at work, and it is decent at what it provides, but we could probably just as well switch to Discord, Microsoft Teams or ICQ. Microsoft Teams especially seems like a deliberate attempt to dethrone Slack, and while it is slightly more annoying to use, it just makes sense for companies to bundle their services and subsciptions. I do not really see a bright future for slack.
- trumbitta2 7y agoI don't think you can post syntax highlighted code snippets, or do automations with ICQ.
- Bombthecat 7y agoWell, probably rpa could help here.. If it makes sense is another story :)
- YarickR2 7y agoThis is something they (ICQ team) are working on right now (actually they are launching ICQ-based Slack-alike collaboration solution, Myteam)
- IMTDb 7y agoYou could switch, sure. But would you ? You would be losing : - Message history - Files that have been shared - Integrations / bots / ... - Plus you would need to setup everyone again, create channels, ... Slack goal is to be cheap enough that it does not represent a major cost for the company and integrated enough that moving would be a pain.
- rockinghigh 7y ago> -18.67 billion $ in revenue You’re confusing revenue and earnings/net income. Revenue is the sum of the sales. Net income, or earnings, is how much money is left after accounting for expenses. Uber alone has tens of billions of dollars in revenue.
- XJ6 7y agoYou're not wrong about OP's confusion, but a quick note that uber recently reported quarterly revenue of ~3.1bn which means "tens of billions" annually is exaggerating a little. Does uber count it's fees as revenue or does it count fees and the fares (which get passed back to the drivers) as revenue? My opinionated take is that if uber wants to pretend that drivers are not employees and it's just a marketplace then they shouldn't be booking the fare as revenue, just their cut but I'm not an accountant and I don't make the rules.
- OJFord 7y ago> My opinionated take is that if uber wants to pretend that drivers are not employees and it's just a marketplace then they shouldn't be booking the fare as revenue, just their cut but I'm not an accountant and I don't make the rules. Good point, but Uber literally takes the money through its app, so I don't suppose that would be possible.
- everythingswan 7y agoYea, classic case of low vs. high margin businesses. Travel is a great example. You would think sites like Expedia would make a healthy margin on airline tickets. Due to the way it's set up (booking systems, airlines, competition) the actual net per ticket is something like $5 for domestic flights. Last I checked Expedia specifically, most of their revenue was on hotels. Contrast that with a high margin business like consulting services or a proprietary technology/product and there's a huge difference in net profit between the two at $10m annual revenue.
- sverige 7y ago
- jsf01 7y ago>negative revenue How is that even possible?
- kelnos 7y agoObviously that happens when your product is so bad that you have to pay people to use it.
- Smirnoff 7y agoThat’s called negative profits or earnings before taxes/depreciation/etc. By definition revenue can’t be negative.
- kelnos 7y agoSorry, my comment was tongue-in-cheek. If revenue is defined as income from operations, having to pay people to use your product could be considered negative income, aka negative revenue (even if that's not how that actually works). I guess it was a bad joke if I have to explain it.
- twic 7y agoWeWork is such a mess that i wouldn't be surprised if their revenue was negative and their profit was a quaternion.
- benj111 7y ago"hating investors" They don't hate investors, just the likes of you or I, and who can blame them? Softbank gives them money on a $47bn valuation, don't have to deal with reporting requirements, don't have short sellers (which SV types seem to be really annoyed by?!).
- kelnos 7y agoTwilio has been non-GAAP profitable for a year now with a positive EPS for the last four quarters (possibly five, but my brain is failing me and Yahoo Finance only lists the last four), but you list it as negative. So that leads me to wonder if many of the other figures you cite have similar issues. (Disclosure: I work at Twilio.)
- twic 7y ago> non-GAAP profitable Like how on my Tinder profile i'm a non-GAAP 10.
- cbm-vic-20 7y agoHas that been seasonally-adjusted?
- notfromhere 7y agoit has been community-adjusted
- sciurus 7y agoYou're missing Eventbrite, which IPOed September 2018 and has lost around half its peak value. https://finance.yahoo.com/quote/EB/ https://finance.yahoo.com/quote/EB/