Yes, there’s a kill switch in John Deere tractors. More on that below but first to the unavoidable topic of tech company valuations.
Tech valuations continue to be under scrutiny
You’d have to be living under a rock not to notice the headlines and stories about the pressure on valuations in the tech sector both in public and private markets, e.g. Fear and Loathing Return to Tech Start-Ups.
Let’s not forget the media gets paid for clicks and so it’s not surprising there’s a new headline or two each day. Equally, they were reporting the good times as well when a new startup was raising $10m at a $100m post-money.
What they’re not reporting now is:
The amount of dry powder in the ecosystem is at record highs;
Many stocks are still up vs. their March 2020 (COVID-19) lows - timing is a wonderful thing; and
At this stage (and I repeat, at this stage), most of the pain is being felt in Series C and later stage valuations as demonstrated by the charts below from AngelList. This is not surprising, as I posted last week, later stage companies are closest to exit (theoretically) and thus should mirror public market moves in valuations the closest.
When does the Buffet’s “Be fearful when others are greedy and be greedy when others are fearful” come in to play? I suspect it’s a bit too soon. Averaging in (in public markets) is not the worst strategy and there are aleady those that are discussing opportunities (More here).
Also note there was a significant number of unicorns birthed during and after the Global Financial Crisis in 2008 - “Never let a crisis go to waste”.
AirBnB was founded in August 2008…
Stablecoins losing their peg?
A few articles explaining why this is significant for crypto:
Tether losing its dollar peg may be the moment the crypto crash reaches the real world
Cryptocurrency luna now almost worthless after controversial stablecoin it is linked to loses peg
Kill-switch Ukrainian tractors
An interesting read about the kill switch in John Deere tractors and how it can be used for good (when the tractors are stolen by Russia from the Ukraine) but also the broader implications of this technology: About those kill-switched Ukrainian tractors