The Rise of the Unicorns. How Media Affects Startup Valuations

The Rise of the Unicorns. How Media Affects Startup Valuations
Author: Severin Zörgiebel
Publisher: GRIN Verlag
Total Pages: 44
Release: 2019-05-29
Genre: Business & Economics
ISBN: 3668949883

Scientific Essay from the year 2016 in the subject Business economics - Investment and Finance, grade: 1,0, University of Frankfurt (Main) (House of Finance), language: English, abstract: Within the last years, start-ups have achieved extraordinary high valuation levels which have never been seen in such dimensions before. These high-valued start-ups with valuations above or equal to US$1bn are also called unicorns. Similarly, media coverage of start-ups has increased significantly. In this paper the impact of media coverage on global unicorn valuations between 1990 and October 2015 is empirically analyzed. In addition, the impact of technology advancements on the media and start-ups is discussed. The here presented results indicate that technology advancements increase media coverage for start-ups. Investors which are typically not primarily active in the VC market are most affected by increasing media coverage. Start-up and especially unicorn valuations are driven to a large extent by increasing media coverage before a funding round. These results add new insights on the driving factors of start-up valuations and are consistent across a variety of different regression models and robustness checks.

The Rise of the Unicorns - How Media Affects Start-Up Valuations

The Rise of the Unicorns - How Media Affects Start-Up Valuations
Author: Severin Zörgiebel
Publisher:
Total Pages: 45
Release: 2016
Genre:
ISBN:

Within the last years, start-ups have achieved extraordinary high valuation levels which have never been seen in such dimensions before. These high-valued start-ups with valuations above or equal to US$1bn are also called unicorns. Similarly, media coverage of start-ups has increased significantly. In this paper the impact of media coverage on global unicorn valuations between 1990 and October 2015 is empirically analyzed. In addition, the impact of technology advancements on the media and start-ups is discussed. The here presented results indicate that technology advancements increase media coverage for start-ups. Investors which are typically not primarily active in the VC market are most affected by increasing media coverage. Start-up and especially unicorn valuations are driven to a large extent by increasing media coverage before a funding round. These results add new insights on the driving factors of start-up valuations and are consistent across a variety of different regression models and robustness checks.

Which factors influence high startup valuations?

Which factors influence high startup valuations?
Author: Christopher Weber
Publisher: GRIN Verlag
Total Pages: 101
Release: 2019-10-01
Genre: Business & Economics
ISBN: 3346026000

Master's Thesis from the year 2018 in the subject Business economics - Company formation, Business Plans, grade: 1,7, Otto Beisheim School of Management Vallendar, language: English, abstract: The author of the work aims to shed light on processes in the startup environment. The work provides a new and more comprehensive view on the valuation drivers of startups by including the dynamics of negotiation during the actual valuation process. The three areas that this work seeks to investigate are: What are the factors that impact the valuation of a startup, especially relating to startup unicorns? Which factors increase the likelihood that a highly valued startup is engaging in a down-round? Which factors are the most important valuation drivers of a startup in each stage of its development? The valuation of a startup results out of a highly complex interplay of different factors which can be assigned to the four dimensions valuation methods and down-rounds, the ecosystem, the startup, and the investor. The author iterviewed active startup investors and entrepreneurs and collected hands-on knowledge from professionals directly involved in the negotiation process.

Why Startups Fail

Why Startups Fail
Author: Tom Eisenmann
Publisher: Currency
Total Pages: 370
Release: 2021-03-30
Genre: Business & Economics
ISBN: 0593137027

If you want your startup to succeed, you need to understand why startups fail. “Whether you’re a first-time founder or looking to bring innovation into a corporate environment, Why Startups Fail is essential reading.”—Eric Ries, founder and CEO, LTSE, and New York Times bestselling author of The Lean Startup and The Startup Way Why do startups fail? That question caught Harvard Business School professor Tom Eisenmann by surprise when he realized he couldn’t answer it. So he launched a multiyear research project to find out. In Why Startups Fail, Eisenmann reveals his findings: six distinct patterns that account for the vast majority of startup failures. • Bad Bedfellows. Startup success is thought to rest largely on the founder’s talents and instincts. But the wrong team, investors, or partners can sink a venture just as quickly. • False Starts. In following the oft-cited advice to “fail fast” and to “launch before you’re ready,” founders risk wasting time and capital on the wrong solutions. • False Promises. Success with early adopters can be misleading and give founders unwarranted confidence to expand. • Speed Traps. Despite the pressure to “get big fast,” hypergrowth can spell disaster for even the most promising ventures. • Help Wanted. Rapidly scaling startups need lots of capital and talent, but they can make mistakes that leave them suddenly in short supply of both. • Cascading Miracles. Silicon Valley exhorts entrepreneurs to dream big. But the bigger the vision, the more things that can go wrong. Drawing on fascinating stories of ventures that failed to fulfill their early promise—from a home-furnishings retailer to a concierge dog-walking service, from a dating app to the inventor of a sophisticated social robot, from a fashion brand to a startup deploying a vast network of charging stations for electric vehicles—Eisenmann offers frameworks for detecting when a venture is vulnerable to these patterns, along with a wealth of strategies and tactics for avoiding them. A must-read for founders at any stage of their entrepreneurial journey, Why Startups Fail is not merely a guide to preventing failure but also a roadmap charting the path to startup success.

Equity Valuation: Science, Art, or Craft?

Equity Valuation: Science, Art, or Craft?
Author: Frank J. Fabozzi
Publisher: CFA Institute Research Foundation
Total Pages: 234
Release: 2017-12-27
Genre: Business & Economics
ISBN: 1944960341

The price at which a stock is traded in the market reflects the ability of the firm to generate cash flow and the risks associated with generating the expected future cash flows. The authors point to the limits of widely used valuation techniques. The most important of these limits is the inability to forecast cash flows and to determine the appropriate discount rate. Another important limit is the inability to determine absolute value. Widely used valuation techniques such as market multiples - the price-to-earnings ratio, firm value multiples or a use of multiple ratios, for example - capture only relative value, that is, the value of a firm's stocks related to the value of comparable firms (assuming that comparable firms can be identified). The study underlines additional problems when it comes to valuing IPOs and private equity: Both are sensitive to the timing of the offer, suffer from information asymmetry, and are more subject to behavioral elements than is the case for shares of listed firms. In the case of IPOs in particular, the authors discuss how communication strategies and media hype play an important role in the IPO valuation/pricing process.

Trampled by Unicorns

Trampled by Unicorns
Author: Maelle Gavet
Publisher: John Wiley & Sons
Total Pages: 224
Release: 2020-10-06
Genre: Business & Economics
ISBN: 1119730643

A Wall Street Journal Bestseller An insider’s revealing and in-depth examination of Big Tech’s failure to keep its foundational promises and the steps the industry can take to course-correct in order to make a positive impact on the world. Trampled by Unicorns: Big Tech’s Empathy Problem and How to Fix It explores how technology has progressed humanity’s most noble pursuits, while also grappling with the origins of the industry’s destructive empathy deficit and the practical measures Big Tech can take to self-regulate and make it right again. Author Maëlle Gavet examines the tendency for many of Big Tech’s stars to stray from their user-first ideals and make products that actually profoundly damage their customers and ultimately society. Offering an account of the world of tech startups in the United States and Europe—from Amazon, Google, and Facebook to Twitter, Airbnb, and Uber (to name a few)—Trampled by Unicorns argues that the causes and consequences of Big Tech’s failures originate from four main sources: the Valley’s cultural insularity, the hyper-growth business model, the sector’s stunning lack of diversity, and a dangerous self-sustaining ecosystem. However, the book is not just an account of how an industry came off the rails, but also a passionate call to action on how to get it back on track. Gavet, a leading technology executive and former CEO of Ozon, an executive vice president at Priceline Group, and chief operating officer of Compass, formulates a clear call to action for industry leaders, board members, employees, and consumers/users to drive the change necessary to create better, more sustainable businesses—and the steps Western governments are likely to take should tech leaders fail to do so. Steps that include reformed tax codes, reclassification of platforms as information companies, new labor laws, and algorithmic transparency and oversight. Trampled by Unicorns’ exploration of the promise and dangers of technology is perfect for anyone with an interest in entrepreneurship, tech, and global commerce, and a hope of technology’s all-empowering prospect. An illuminating book full of insights, Trampled by Unicorns describes a realistic path forward, even as it uncovers and explains the errors of the past. As Gavet puts it, “we don’t need less tech, we need more empathetic tech.” And how that crucial distinction can be achieved by the tech companies themselves, driving change as governments actively pave the road ahead.

Chasing Unicorns

Chasing Unicorns
Author: Nicko Widjaja
Publisher: Kepustakaan Populer Gramedia
Total Pages: 246
Release: 2023-08-02
Genre: Business & Economics
ISBN: 623134035X

In Search of Fool's Gold is a candid exploration of the intricate venture capital landscape in Indonesia and Southeast Asia. It's an insider's perspective that offers a unique and comprehensive understanding of the ecosystem's volatile nature. Nicko Widjaja, a seasoned professional in the startup investment realm, shares firsthand experiences, insights, and revelations about the challenges and opportunities that define this dynamic sector. The narrative unfolds to depict the dramatic rise and fall of tech startups in the region, spotlighting their devolution from ÔunicornsÕ to ÔcentaursÕ, exploring the multifaceted implications of this shift. Widjaja presents a thoughtful examination of the domino effect that both entrepreneurs and investors initiate within the industry. In the pursuit of unicorns, the reader is confronted with harsh realities: the lack of transparency, sudden shifts in deal agreements, and market-specific hurdles. Yet, interwoven within these dramas, is a tale of potential and hope, underscoring the importance of good governance and strategy overhaul in fixing the industry for the better. Chasing Unicorns: In Search of Fool's Gold captures the unpredictable terrain of Southeast Asian venture capital, demystifying the quest for unicorn investments and the realities that lie beneath the pursuit.

The Customer-Funded Business

The Customer-Funded Business
Author: John Mullins
Publisher: John Wiley & Sons
Total Pages: 309
Release: 2014-07-21
Genre: Business & Economics
ISBN: 111887885X

Who needs investors? More than two generations ago, the venture capital community – VCs, business angels, incubators and others – convinced the entrepreneurial world that writing business plans and raising venture capital constituted the twin centerpieces of entrepreneurial endeavor. They did so for good reasons: the sometimes astonishing returns they've delivered to their investors and the astonishingly large companies that their ecosystem has created. But the vast majority of fast-growing companies never take any venture capital. So where does the money come from to start and grow their companies? From a much more agreeable and hospitable source, their customers. That's exactly what Michael Dell, Bill Gates and Banana Republic's Mel and Patricia Ziegler did to get their companies up and running and turn them into iconic brands. In The Customer Funded Business, best-selling author John Mullins uncovers five novel approaches that scrappy and innovative 21st century entrepreneurs working in companies large and small have ingeniously adapted from their predecessors like Dell, Gates, and the Zieglers: Matchmaker models (Airbnb) Pay-in-advance models (Threadless) Subscription models (TutorVista) Scarcity models (Vente Privee) Service-to-product models (GoViral) Through the captivating stories of these and other inspiring companies from around the world, Mullins brings to life the five models and identifies the questions that angel or other investors will – and should! – ask of entrepreneurs or corporate innovators seeking to apply them. Drawing on in-depth interviews with entrepreneurs and investors who have actually put these models to use, Mullins goes on to address the key implementation issues that characterize each of the models: when to apply them, how best to apply them, and the pitfalls to watch out for. Whether you're an aspiring entrepreneur lacking the start-up capital you need, an early-stage entrepreneur trying to get your cash-starved venture into take-off mode, an intrapreneur seeking funding within an established company, or an angel investor or mentor who supports high-potential ventures, this book offers the most sure-footed path to starting, financing, or growing your venture. John Mullins is the author of The New Business Road Test and, with Randy Komisar, the widely acclaimed Getting to Plan B.

The Unicorn's Shadow

The Unicorn's Shadow
Author: Ethan Mollick
Publisher: University of Pennsylvania Press
Total Pages: 117
Release: 2020-06-23
Genre: Business & Economics
ISBN: 1613630972

Bringing hard data to the way we think about entrepreneurial success, this bold call to action draws on the latest scientific evidence to dispel the most pervasive startup myths and light a path to entrepreneurship for those eclipsed by the hype. When you think of a successful entrepreneur, who comes to mind? Bill Gates? Mark Zuckerberg? Or maybe even Jesse Eisenberg, the man who played Zuckerberg in The Social Network? It may surprise you that most successful founders look very different from Zuckerberg or Gates. In fact, most startup origin stories are very different from the famous "unicorns" that have achieved valuations of over $1 billion, from Facebook to Google to Uber. In The Unicorn's Shadow: Combating the Dangerous Myths that Hold Back Startups, Founders, and Investors, Wharton School professor Ethan Mollick takes us to the forefront of an empirical revolution in entrepreneurship. New data and better research methods have overturned the conventional wisdom behind what a successful founder looks like, how they succeed, and how the startup ecosystem works. Among the issues he examines: Which founders are most likely to succeed?Where do the best startup ideas come from?What's the most foolproof way of securing the funding needed to take a company to the next level?Should your sales pitch really be something out of Hollywood?What's the best way to grow and scale your company and create a thriving culture that won't hinder expansion? Mollick argues that entrepreneurship is too important, both for society and for the individuals who start companies, to be eclipsed by the shadows of unicorns. He shows we can democratize entrepreneurship—but only by following an evidence-based approach that puts to rest the false narratives that surround it.

Trends and Advances in Information Systems and Technologies

Trends and Advances in Information Systems and Technologies
Author: Álvaro Rocha
Publisher: Springer
Total Pages: 1235
Release: 2018-03-24
Genre: Technology & Engineering
ISBN: 3319777033

This book includes a selection of papers from the 2018 World Conference on Information Systems and Technologies (WorldCIST'18), held in Naples, Italy on March27-29, 2018. WorldCIST is a global forum for researchers and practitioners to present and discuss recent results and innovations, current trends, professional experiences and the challenges of modern information systems and technologies research together with their technological development and applications. The main topics covered are: A) Information and Knowledge Management; B) Organizational Models and Information Systems; C) Software and Systems Modeling; D) Software Systems, Architectures, Applications and Tools; E) Multimedia Systems and Applications; F) Computer Networks, Mobility and Pervasive Systems; G) Intelligent and Decision Support Systems; H) Big Data Analytics and Applications; I) Human–Computer Interaction; J) Ethics, Computers & Security; K) Health Informatics; L) Information Technologies in Education; M) Information Technologies in Radiocommunications; N) Technologies for Biomedical Applications.