Wednesday, October 17, 2018

Uber and the future of the Unicorns

The IPO (initial public offering) of Uber Technologies, even without a defined date, promises to be the most attractive next year (valuation $120B), as they were Snapchat SNAP,(2017), Alibaba BABA (2014) or Linkedin LNKD (2011). And it is that the famous application for private transport, already present in almost 600 cities around the world, is extremely popular, required, valuable and, therefore, full of demands (mainly of nonconformist users and other formal taxi services) and competition in many countries (Lyft, Curb, Didi, among other apps), all copying the same principle. Even Google GOOG, is developing its product, relying on its acquisition of the popular Waze, and its upcoming developments of autonomous driving, something that Uber has also focused its latest efforts.

The shocking news in 2017 in this unicorn (start-up with a billionaire valuation) perhaps the most renowned start-up of its genre, was the departure of its CEO, founder, Travis Kalanick, forced to resign by the shareholders, in a case that recalled Steve Jobs and Apple. This time, the reason was accusations of sexual harassment and discrimination in the company, and it is understood that Uber shareholders want an early change of image of the company. In my opinion it seems a somewhat drastic and yes, it has caused a stir because close to its 1,400 employees demand their return in an operational position (still belongs to the board and with weight in it).

But, delving into the subject, what is the real future of these companies called unicorn? It is known that these billion-dollar start-ups grew from 2013 to fall in number last year to increase the scandals around them. In addition, the convenience of staying in the private market far from market regulations, and seeing the poor performance of Snapchat SNAP in Wall Street, makes many of its CEOs hesitate to take the crucial step towards IPOs.

Our collaboration with Toptal allows us to publish this detailed analysis of Toby Clarence-Smith on this subjectIt's introduction:

Between 2013 and 2015, the number of Unicorns (private technology companies valued at more than $ 1 trillion) exploded from 16 to 140, marking an incredible growth in valuations and positive sentiments towards the risky financing industry.

 But after a tumultuous 2016, in which scandals, sales of parts of its capital, more comments from cautious investors emerged and many have questioned the validity of the sector's valuations. With this fall, 2017 seems to be the year of decisions for the Unicorn Club.

An analysis of the trends and the factors that possibly trace the course of the coming year show that expectations that seem to be more realistic may be unfounded. In fact, prospects for private technology companies have a great chance of improving.

The number of unicorns decreased in 2016, but their valuation continues to rise.