Equity When will the paper unicorns fold?
May 24, 2023
In a recent discussion, Jeff Richards, managing partner at GGV Capital and a seasoned investor since 2008, shares insights on the current state of late-stage startups. He debunks the myth that all unicorns are struggling, highlighting that some are thriving despite challenging market conditions. The conversation dives into what successful startups have in common and how early signals can indicate changes in the venture climate. Richards also touches on the future of IPOs and the contrasting fates of those gearing up for public offerings versus those facing liquidation.
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Low Rates & Tech Boom
- Low interest rates encourage risk-taking, leading to asset inflation.
- The intersection of cloud, mobile, and payments innovation fueled the tech boom.
ServiceNow's Growth
- ServiceNow, a venture-backed software company, exemplifies the tech boom's success.
- Its value grew from $100 million in 2012 to $90 billion in 2023.
Pandemic's Impact
- The pandemic and zero-percent interest rates fueled a speculative period in the market.
- The durability of software during the downturn further added to the optimism.