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Secondary shops flooded with unicorn sellers

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21–30 of 158 posts

Re: Secondary shops flooded with unicorn sellers

#21

Earlier quoted context omitted.

Side note: You're considered an "accredited investor" if you made $200k/year in each of the prior two years and expect a similar income in the current year. https://www.investor.gov/news-alerts/investor-bulletins/inve... So, not necessarily just "wealthy" individuals.

That's pretty wealthy by most standards, isn't it?

I think the point was that you don't necessary need wealth (assets) for which the threshold is $1 USD Million excluding the value of your primary residence.

You can instead have a high income (the $200k mentioned) and zero wealth. I suspect that many more people qualify as accredited under the income requirement than qualify under the asset requirement.

Re: Secondary shops flooded with unicorn sellers

#22
>“In tech, when times are good, it’s about potential. When they aren’t, investors focus much more on fundamentals.”

That second part... why that isn't ALWAYS the focus is beyond me.

Edit: Adding a clarifying statement as my point wasn't specific enough. I'm very aware that early stage investments are VERY speculative, but when we're talking about a company moving into 1BN+ valuation territory, fundamentals should be in focus.

Re: Secondary shops flooded with unicorn sellers

#23
I think that this is just the beginning. In my opinion, we're heading for a tech bust that's going to spread to the rest of the economy, and deflate additional bubbles (housing, for one). The government has been pushing cheap money for the better part of a decade in the name of creating the appearance of a 'recovery', but what they've really done is build a new house of cards. Make no mistake: the 'free' money that's been gushing into major institutions under the current administration is just as distortive and will be just as disastrous as the 'free' money that the last administration encouraged banks to put into the hands of sub-prime individuals.

Maintaining a near-zero interest rate creates artificial demand, and encourages investment of capital in inefficient enterprises. The thought process is "hey, I lose value with money in the bank. I'd be better off if I found something -- anything -- else to do with it!"

I think that once things take a turn, housing will also turn again, because in many areas the median house now costs enough that it's beyond the reach of the median person. That environment is unsustainable over a large time scale. Ultimately, we'll need a correction that sticks if we want to avoid repeating these events, and for that to happen we'd need a government willing to tolerate a politically unpalatable permanent reduction in asset prices.

(edit/note: I do find it odd that under a Democratic president, the major flows of borrowed cash (debt) have been directed to the big guys, while under a Republican president, they were directed to the little guys. Both were a terrible idea, but it seems backwards for what one would expect.)

Re: Secondary shops flooded with unicorn sellers

#24

>“In tech, when times are good, it’s about potential. When they aren’t, investors focus much more on fundamentals.” That second part... why that isn't ALWAYS the focus is beyond me. Edit: Adding a clarifying statement as my point wasn't specific enough. I'm very aware that early stage investments are VERY speculative, but when we're talking about a company moving into 1BN+ valuation territory, fundamentals should be…

As a counterexample, Google didn't show ads until 2000. http://googlepress.blogspot.com/2000/10/google-launches-self...

Re: Secondary shops flooded with unicorn sellers

#25
post #4

Has any HNer participated in such a secondary sale? I think it could be informative to describe the experience, whom you dealt with, how a price was agreed upon, how your company discussed secondary sales, etc.

EquityZen (https://equityzen.com) has conducted several transactions in private companies, including many Unicorns, and charges only one fee (and no escrow fee).

Re: Secondary shops flooded with unicorn sellers

#26

>“In tech, when times are good, it’s about potential. When they aren’t, investors focus much more on fundamentals.” That second part... why that isn't ALWAYS the focus is beyond me. Edit: Adding a clarifying statement as my point wasn't specific enough. I'm very aware that early stage investments are VERY speculative, but when we're talking about a company moving into 1BN+ valuation territory, fundamentals should be…

Because that requires everyone involved to understand what the fundamentals are. Half the time investors just go wherever there is the most noise and buzzwords.

Re: Secondary shops flooded with unicorn sellers

#27

>“In tech, when times are good, it’s about potential. When they aren’t, investors focus much more on fundamentals.” That second part... why that isn't ALWAYS the focus is beyond me. Edit: Adding a clarifying statement as my point wasn't specific enough. I'm very aware that early stage investments are VERY speculative, but when we're talking about a company moving into 1BN+ valuation territory, fundamentals should be…

It's the difference between a sellers' and buyers' market (boom vs bust). To get a low entry point during a boom, you have to invest before there's hard evidence of success. Kind of like how a race car needs to turn before corner entry in order to avoid going too wide.

Re: Secondary shops flooded with unicorn sellers

#28
post #24

>“In tech, when times are good, it’s about potential. When they aren’t, investors focus much more on fundamentals.” That second part... why that isn't ALWAYS the focus is beyond me. Edit: Adding a clarifying statement as my point wasn't specific enough. I'm very aware that early stage investments are VERY speculative, but when we're talking about a company moving into 1BN+ valuation territory, fundamentals should be…

As a counterexample, Google didn't show ads until 2000. http://googlepress.blogspot.com/2000/10/google-launches-self...

But the fundamentals were not ads. It was solid search. That's what delivered value to users and why they kept coming back.

Re: Secondary shops flooded with unicorn sellers

#29

>“In tech, when times are good, it’s about potential. When they aren’t, investors focus much more on fundamentals.” That second part... why that isn't ALWAYS the focus is beyond me. Edit: Adding a clarifying statement as my point wasn't specific enough. I'm very aware that early stage investments are VERY speculative, but when we're talking about a company moving into 1BN+ valuation territory, fundamentals should be…

I figure it's baked into the name Venture Capital. A venture is about potential rather than fundamentals. The question for any particular venture is when fundamentals become a more important metric than potential.

Re: Secondary shops flooded with unicorn sellers

#30
post #20
post #19

Earlier quoted context omitted.

Heh, I'm not 'poor' but how in the hell is 199k/year not 'wealthy'?

You live in downtown Manhattan.

$200k in Manhattan puts you above 84% of people living in Manhattan.

http://www.politifact.com/truth-o-meter/statements/2013/mar/...

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