It is the VC community (who takes many liberties and are super aloof- unwarranted) who came up with the term ‘unicorn’. Basically, it was to tag a company as a target for pointless massive funding, while losses piled up and no profits of course, to justify an absurdly ridiculous valuation and IPO. Once tagged as an IPO, it created the tsunami of excessive funding, outrageous valuations and unsustainable money wasted and poor leadership.

So that no-plan — plan worked for a while and some of the IPOs were absurdly successful while all burned more money than they ever earned. Then came the reckoning. Uber! Wait What? People are not blindly pushing the stock price up? Investors can read financial reports. Uber tanked and so did many of the other IPOs as they well should this year. The right ones succeeded.

Then came the darling of the delusional VC investors, WeWork – another company tagged as a unicorn, amassing outrageous amount of investments with no upside and valuations so unwarranted and off the charts, not worth our time to review. Solution: Fire the CEO, pull the IPO away from the market- regroup!

Reality check: VC’s have created this problem. So, why are they so surprised? This is a time that we can readjust to a realistic world, where we fund based on potential and not hype. I look forward to a ‘winter slowdown’. Note: does this not sound like 2000 with internet investments that all failed? Many of the VC’s got burned then right?

Next I will blog about companies that have raised minimal money and are wildly financially successful and have penetrated the market. The REAL companies. Unfortunately, they are not on the radar of VC’s because they are not going to raise ridiculous rounds nor are they ready for IPO’s. So time for VC’s to do a reality check and get off the hype-wagon of false ‘unicorn’ creations and not act so surprised…

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