Another day, another unicorn is born. Or rather 2:
Closer to Unicorn Valley a.k.a Silicon Valley a.k.a the Valley, Square becomes the latest unicorn to file for an IPO. Never mind that CEO Jack Dorsey also happens to be running Twitter. At the same time.
According to the Techcrunch Leaderboard, as of October 12, 2015, there are 149 Unicorn worhth $521.2 Billion, 19 Exited Unicorns worth $138.3 Billion(note this includes "flops" like Fab) and 38 Emerging a.k.a "almost" Unicorns worth another $25.7 Billion. Combined, they have raised a grand total of $97.2 Billion. Not too shabby.
With the world literally swimming with unicorns, it's fair for inquiring minds to ask: are we at peak startup?
Forbes, never one to shy away from calls it just the beginning, courtesy of writer Miguel Helft:
Dan Primack over at Fortune senses that the top is upon us.
So are valuations "stretched"? One could argue that . On the other hand, it remains true that Facebook's $1 Billion Instagram acquistion looked ludicrous rich way back when in 2012, but is now quite evidently a steal. Who remembers the ridicule at a Facebook valuation of $10 Billion? It's difficult to predict where exactly the market goes from here.
However, I think it is uncontroversial to state that any future monetary tightening by the Fed, will place downward pressure on valuations and make raising money much more difficult. Furthermore, the global economy isn't looking so hot, and any stockmarket drop/economic downturn will no doubt touch even the most high-flying of startups.
Let's enjoy the manna while it lasts.
NB: Let's also not forget that there are thousands of great companies, building great products but that will never be worth anything close to even a tenth of $1 Billion. Mega valuations suck all the oxygen simply because the numbers dazzle and the scale/growth of the company. Those are but a tiny fraction of our world.