      Unknown Publication · 2015-12-26
      · 3813d
    

Technology Bubble 2.0 Deflation: Signs, Consequences, and Recovery

Dave Kellogg analyzes the deflation of the second technology bubble, identifying four key warning signs including down-round IPOs, markdown valuations, and denial from industry leaders. He predicts a multi-year unwinding characterized by management changes, layoffs, litigation, and eventual return to sustainable business fundamentals rather than a sudden burst.

9 metrics· Cited 0× in the knowledge base ·Open source ↗

Metrics in this report

Dataminr Valuation Markdown

35%

markdown by mutual funds

Mutual fund valuation adjustment for private unicorn

Deflation Timeline Ratio

3.5years minimum

lower bound estimate

Expected unwinding period if 7 years to inflate

Gilt Groupe Valuation Decline

77.3%

decline from peak

Gilt Groupe from $1.1B valuation to $250M potential sale price

Layoff Requirement at Breakeven

200-400headcount

range

Employees at $10M quarterly burn to reach cash flow breakeven

MongoDB Valuation Markdown

54%

markdown by mutual funds

Mutual fund valuation adjustment for private unicorn

Snapchat Valuation Markdown

25%

markdown by mutual funds

Mutual fund valuation adjustment for private unicorn

Typical Quarterly Burn Rate

10$M

or more

High-burn unicorn companies

Unicorn Count

130count

approximate

Companies with $1B+ valuation at time of writing

Zenefits Valuation Markdown

48%

markdown by mutual funds

Mutual fund valuation adjustment for private unicorn