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If unicorn valuation is just PR, then what is a better measurement of a company's worth, which is widely available and accepted? If that measurement is used, d

If unicorn valuation is just PR, then what is a better measurement of a company's worth, which is widely available and accepted? If that measurement is used, does it negate the thrust of TFA?

toomuchtodo 2y ago
Revenue, EBITDA/EBITDA multiples, and/or discounted cashflow. Valuations were potentially useful during ZIRP when capital was chasing any yield it could (lottery tickets), but in "higher for longer" interest rate macros, cashflow and profits are king (versus capital furnaces promising future profitability with no proof that event will ever arrive). If you're not yet profitable, you're not a business, you're an experiment not yet proven (which is fine, that's the whole point of being a startup). The valuation is based on hope otherwise.
- consumer451 2y ago
  OK, agreed on most of that. > If that measurement is used, does it negate the thrust of TFA? How about this part? Is there any reason to think that it would?
  - toomuchtodo 2y ago
    The article is basically arguing "immigrant founders good because look at all of these fictitious valuation companies they start and run." Whether you agree with this will be a function of your belief in the data on the topic. The data overwhelmingly shows these valuations are propped up by the VC ecosystem for self interested reasons (greater fool theory), and are not valuations grounded in commonly agreed upon financial fundamentals (and the benefits of these enterprises are tenuous at best), so the appeal to emotion is not effective (in my opinion). https://www.sfgate.com/tech/article/bay-area-venture-capital-bleeding-cash-laffont-19929955.php https://www.sfgate.com/tech/article/bay-area-venture-capital... ”In God we trust. All others must bring data.”
    - consumer451 2y ago
      > so the appeal to emotion is not effective Where exactly in all of this is an appeal to emotion?
      - toomuchtodo 2y ago
        “Don’t you want more billion dollar startups!?” is how I read the title. It is an appeal to emotion of faux innovation and economic dynamism, reading between the lines, which should come as no surprise. The blog author/org is an immigration services law firm. It is content marketing, and their business requires immigration requiring their services to survive. https://www.fosterglobal.com/about-us/ https://www.fosterglobal.com/about-us/

If unicorn valuation is just PR, then what is a better measurement of a company's worth, which is widely available and accepted? If that measurement is used, does it negate the thrust of TFA?

toomuchtodo 2y ago

Revenue, EBITDA/EBITDA multiples, and/or discounted cashflow. Valuations were potentially useful during ZIRP when capital was chasing any yield it could (lottery tickets), but in "higher for longer" interest rate macros, cashflow and profits are king (versus capital furnaces promising future profitability with no proof that event will ever arrive). If you're not yet profitable, you're not a business, you're an experiment not yet proven (which is fine, that's the whole point of being a startup). The valuation is based on hope otherwise.

consumer451 2y ago
OK, agreed on most of that. > If that measurement is used, does it negate the thrust of TFA? How about this part? Is there any reason to think that it would?
- toomuchtodo 2y ago
  The article is basically arguing "immigrant founders good because look at all of these fictitious valuation companies they start and run." Whether you agree with this will be a function of your belief in the data on the topic. The data overwhelmingly shows these valuations are propped up by the VC ecosystem for self interested reasons (greater fool theory), and are not valuations grounded in commonly agreed upon financial fundamentals (and the benefits of these enterprises are tenuous at best), so the appeal to emotion is not effective (in my opinion). https://www.sfgate.com/tech/article/bay-area-venture-capital-bleeding-cash-laffont-19929955.php https://www.sfgate.com/tech/article/bay-area-venture-capital... ”In God we trust. All others must bring data.”
  - consumer451 2y ago
    > so the appeal to emotion is not effective Where exactly in all of this is an appeal to emotion?
    - toomuchtodo 2y ago
      “Don’t you want more billion dollar startups!?” is how I read the title. It is an appeal to emotion of faux innovation and economic dynamism, reading between the lines, which should come as no surprise. The blog author/org is an immigration services law firm. It is content marketing, and their business requires immigration requiring their services to survive. https://www.fosterglobal.com/about-us/ https://www.fosterglobal.com/about-us/