Investors in startups value a company based on the likelihood that they can pawn off a money losing company either to the public markets or an acquirer.
That doesn’t help now that the public market doesn’t have an appetite for companies that aren’t profitable.
So if retail investors aren’t interested in non profitable companies, there is no profit it in it for investment bankers to flip the stock at IPO to take advantage of a “pop” meaning that VCs are less interested in throwing good money after bad.
How have the former “unicorns” focused on “growth” fared in the last few years?
For instance DoorDash couldn’t make a profit during a worldwide pandemic when everyone was ordering takeout.
That doesn’t help now that the public market doesn’t have an appetite for companies that aren’t profitable.
So if retail investors aren’t interested in non profitable companies, there is no profit it in it for investment bankers to flip the stock at IPO to take advantage of a “pop” meaning that VCs are less interested in throwing good money after bad.
How have the former “unicorns” focused on “growth” fared in the last few years?
For instance DoorDash couldn’t make a profit during a worldwide pandemic when everyone was ordering takeout.