October 30, 2015 Comments Off on Economic Impact of A Tech Unicorn’s Billion Dollar Bubble Popping Views: 583 National News

Economic Impact of A Tech Unicorn’s Billion Dollar Bubble Popping

With venture capitalists shelling out billions to invest in start-ups, there are huge risks and consequences of failure that are seemingly being ignored. Although the stock market is not affected by the potential failure of these privately owned entities, the overall economy may still feel the quake.

Since the beginning of 2014, there are now 124 tech start-ups valued at $1B or more. If many of these companies don’t make it to their IPO, the initial blowback could disrupt the job market, with thousands in highly skilled and highly paid jobs losing employment. Additionally, the indirect consequences could affect the commercial real estate market, as well as public companies that still rely on investor cash flow to fund their growth.

As the pressure mounts to create “unicorns” (billion dollar+ valuations) for these start-ups, the truth is that they are actually increasing debt because no money is free money.

Read More At The Wall Street Journal

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