Because they've taken credit for so many modern unicorns, people forget that VC's don't exist to invest in businesses for what those businesses will achieve. No

Because they've taken credit for so many modern unicorns, people forget that VC's don't exist to invest in businesses for what those businesses will achieve. Nobody can guess what an ambitious unknown startup will actually achieve in 3 or 5 or 10 years. They invest in portfolios of ambitious unknown startup for what subsequent investors will think of them some time later. They sell hype. Markets where everybody expects growth and where investors have easy access to money are hot markets for VC's and that's the market we were still in the tail end of 3 years ago. Later investors are optimistic about real business prospects and they have capital they want to leverage so VC's have a ton of wealthy buyers to court with their exciting products. But that's not the market we're in right now, so the VC model doesn't thrive nearly as well. And the stark transition can indeed cause a bleed as old bets turn wrong and start to really hurt. This kind of story can be a helpful reminder as to how venture capital works and the kinds of markets it works well or poorly in, but it's not a big surprise and every experienced VC probably has a strategy for how they'll navigate it.