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LinkedIn shares drop 40%, erasing $10B of company's value

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Re: LinkedIn shares drop 40%, erasing $10B of company's value

#551

Post by codesushi42 »

toomuchtodo wrote: post #548
codesushi42 wrote: post #542

Earlier quoted context omitted.

/Average wages/. On a macro scale. That's not the same situation. Of course you're going to see the $150-200k premium for engineers fall once startups, funding, and jobs disappear. It's already happening in the form of cutting RSUs and bonus packages. And it has happened before. Why is it so hard to understand this?

Because most people here weren't around for 1999-2001.

Agreed. But I'm still a little surprised by this. I would expect anyone at least 30 yro to have /some/ recollection of what happened, if not a good understanding. Or to have the curiosity to find out what did. I'm 31 myself, but knew what was happening with the bubble during highschool (thanks pud and F'd company).

Maybe the typical age on HN is 21? :)

Re: LinkedIn shares drop 40%, erasing $10B of company's value

#552

Post by bigsteve78 »

What do you expect? consider this. I am a data scientist (hottest job in north america) with an optimized profile and I haven't got a single job offer. (not that I need it) The reality here is its NOT HELPING PEOPLE GET INTERVIEWS. why the fuck would I pay for premium when it does shit for my career? ~End rant.

Re: LinkedIn shares drop 40%, erasing $10B of company's value

#553

Post by aws_ls »

marincounty wrote: post #471
yeukhon wrote: post #449

Earlier quoted context omitted.

SF is heavily relying on the high-tech, high salary population to sustain its high market value. So SF is always at risk of having market breakdown. But because giants like Google and Facebook have offices in SF, or near SF, as long as that population remain, SF market will survive, no matter what. If SF only relies on startup, SF will doom. Startup population, however, is dragging the price higher, so high that even…

I'll get hammered for this, but I just wonder if we will be talking about Google, and Facebook ten years from right now? I know both have diversified, and Google has become best friends with the Obama administration. I just wonder if they will be relevant? These tech companies main reason for living is advertising, and their algorithms. I look back, and Apple had a physical product. Other than Apple, exactly what com…

Google and Facebook are completely different animals. They both make money through advertising[1], but the use cases are different. Even their algorithms have different implications. In Google's case for example, their search is like an ever improving AI, increasingly hard to overtake. And assuming search is going to continue to be a need, it may become increasingly hard for a competitor to overcome them. I do understand nothing lasts forever, but only thing is I don't see it coming yet.

Sibling comment, compares Goog with MS 10 years back. My humble submission is several people saw it coming even then. I remember reading a book called 'The Search', and also having some discussions with friends, where we felt that Google will overtake MS. But there is no such thing in the horizon, which challenges Google. And people tried - Blekko was noteworthy. DDG is also liked by hackers, but it remains to be seen in the long term.

Now talking about FB's algos (or AI). Its purely anecdotal, but till I was using FB, I found it highly irritating. Imagine if your email was trying to guess which email you like to read, rather than simple time sorted one (and brief categorization, which gmail does).

[1] This analogy of comparing Google to advertising company has become a bit tiring now as well. I think, thats their current way of making money, we should judge them by what their intrinsic value is - Search/self-driving cars/Youtube/etc. As the means may change (micro-payments via Bitcoin/etc who knows?)

Re: LinkedIn shares drop 40%, erasing $10B of company's value

#554

Post by weeksie »

codesushi42 wrote: post #542
weeksie wrote: post #538

Earlier quoted context omitted.

Actually, basic economics says that wages tend to be sticky.

/Average wages/. On a macro scale. That's not the same situation. Of course you're going to see the $150-200k premium for engineers fall once startups, funding, and jobs disappear. It's already happening in the form of cutting RSUs and bonus packages. And it has happened before. Why is it so hard to understand this?

Oh, I was around.

Regardless, I was stating that your dismissal of "basic economics" was wrong. It's not basic economics, there's a lot that goes into the equation. Wages might go down. Wages might not go down by a ton. They might drop like a rock. It all depends on a number of factors, but blithely dismissing people with some nonesense about econ 101 is not being intellectually honest.

Re: LinkedIn shares drop 40%, erasing $10B of company's value

#555

Post by swingbridge »

pyrrhotech wrote: post #312

A lot of people hating on LNKD here, but this isn't really company-specific. This is a macro shift. LNKD being down by 40% by only guiding down 8% below estimates is a big warning of how the market is about to treat all bloated growth stocks. In 2013, if they reported the same results, the stock would have been flat or slightly down. It's a major shift in investor sentiment. Bubble bursts always start in the public m…

The current tech bubble has some fundamental differences to the last one. Specifically, while some of the pain will hit public markets the vast majority of people left holding bags of burning crap this time around are the VC firms and other private investors. The SF Bay region is going to have an implosion but the impact on the broader stock market and US economy will be quite limited.

In short, if you just bought a big chunk of San Francisco real estate on the basis that you pay it off in a few years when you cash out the options in your hyped up tech startup... well good luck with that.

Re: LinkedIn shares drop 40%, erasing $10B of company's value

#556

Post by angelbob »

ec109685 wrote: post #517
tryitnow wrote: post #501

Earlier quoted context omitted.

Gloomy, but likely correct. A lot of these current valuation numbers just don't make sense. The implied growth rates in many tech stocks is unrealistically high. The Bay Area's long-term employment prospects simply cannot support current home values or rental rates. Once public and private equity valuations drop a lot of software development projects are going to get cut and with them the jobs of many software engine…

>The Bay Area's long-term employment prospects simply cannot support current home values or rental rates. Why not? What are you basing this on?

He's reasonably and appropriately worried about both the shaky unicorns and the seed funding bubble, neither of which seems terribly sustainable.

There are other games in town, but those two games were seriously inflating salaries here.

Re: LinkedIn shares drop 40%, erasing $10B of company's value

#557

Post by angelbob »

monkeywork wrote: post #518
DougN7 wrote: post #492

Earlier quoted context omitted.

I think you might be right. I remember about 10 years ago having a discussion with a coworker. He was bemoaning the fact that Microsoft was so far entrenched that nobody would ever be able to challenge them. Back then Microsoft looked like Google does today. Nobody stays on top forever.

but Microsoft is still in top in terms of market share on desktop, and they have started to put a dent into the prosumer tablet market, and they compete well in the gaming market. I'd say they are still "on top"

Microsoft is long past "nobody would ever be able to challenge them." Maybe on desktop, provided you exclude the server market.

You didn't used to have to exclude the server market. They owned that too. Then Linux challenged them and won.

In fact, they used to own all PCs. Then Apple challenged them for laptops and won.

Microsoft isn't doing badly, but it's not an unchallengeable juggernaut any more.

And Google won't be forever either.

Re: LinkedIn shares drop 40%, erasing $10B of company's value

#559

Post by angelbob »

teen wrote: post #543
neelborooah wrote: post #506

Earlier quoted context omitted.

As an engineer working at a "well-funded" startup, how can I prepare for the worst?

be good at programming?

Being good at programming is useful, but planning what happens if random changes in the business screw you is still useful.

I've been a software engineer for going on 20 years now. Have a plan, just in case, even if you're good at programming (I am.)

Re: LinkedIn shares drop 40%, erasing $10B of company's value

#560

Post by codesushi42 »

weeksie wrote: post #554
codesushi42 wrote: post #542

Earlier quoted context omitted.

/Average wages/. On a macro scale. That's not the same situation. Of course you're going to see the $150-200k premium for engineers fall once startups, funding, and jobs disappear. It's already happening in the form of cutting RSUs and bonus packages. And it has happened before. Why is it so hard to understand this?

Oh, I was around. Regardless, I was stating that your dismissal of "basic economics" was wrong. It's not basic economics, there's a lot that goes into the equation. Wages might go down. Wages might not go down by a ton. They might drop like a rock. It all depends on a number of factors, but blithely dismissing people with some nonesense about econ 101 is not being intellectually honest.

You're still talking macro 101. I'm not talking about nationwide unemployment figures here.

The key is that wages for /engineers/ will fall if funding and jobs disappear in the tech sector. Today's wages for engineers are high and will be unsustainable when things go bust.

How much they will fall is anyone's guess. But the reasoning behind why they will fall is very straightforward.

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