Subprime ‘unicorns’ that do not look a billion dollars

Post by AndrewKemendo » Sat, Oct 17, 2015, 7:49 PM UTC

dbcooper wrote: post #40

adventured wrote: post #34

Earlier quoted context omitted.

Beyond the things you point out, my biggest point of skepticism on Theranos is its business and the potential value of it. Lab Corp is worth $11 billion. With $6 billion in sales (and having generated ~$1.6 billion in profit over the last three years). The market Theranos is tackling is not as huge as some people apparently would like to think. Lab Corp is a monster in the field, and they're merely doing $11 billion.…

Abaxis (manufacturers of the "Piccolo" systems, which seem to be lab-on-disc based and offer point-of-care operation) are an interesting company to compare to Theranos. They seem to be able to perform small panels of assays (up to 14) on 100 µL samples [1] obtained by venipuncture.[2] They are valued at $880M, and had ~ $200M revenue and $27M profit in the last financial year. http://www.abaxis.com/about_us/history.h…

Post by pbreit » Sat, Oct 17, 2015, 9:56 PM UTC

amluto wrote: post #69

akiselev wrote: post #28

Earlier quoted context omitted.

I am on board with your skepticism, but I don't believe your concerns are valid in the context of what Theranos is promising and what they have done ($400 million is nothing to scoff at in an industry where you have $0 revenue until a real breakthrough passes the FDA). The global pharmavertical industry is about $900 billion a year and has a very wide variance in types of products so the normal idea of what what valu…

I'm not entirely convinced that what Theranos is promising is even that great. A couple weeks ago I got a blood test. I walked into the test center, which was staffed by a single person. I waited in line (there was one person in front of me), and told the person my name. She walked me over to a chair, drew enough blood for a whole bunch of tests, and that was it. I was in and out in 12 minutes (I timed it), and it wa…

Post by pbreit » Sat, Oct 17, 2015, 10:03 PM UTC

AndrewKemendo wrote: post #81

dbcooper wrote: post #40

Earlier quoted context omitted.

Abaxis (manufacturers of the "Piccolo" systems, which seem to be lab-on-disc based and offer point-of-care operation) are an interesting company to compare to Theranos. They seem to be able to perform small panels of assays (up to 14) on 100 µL samples [1] obtained by venipuncture.[2] They are valued at $880M, and had ~ $200M revenue and $27M profit in the last financial year. http://www.abaxis.com/about_us/history.h…

They are valued at $880M, and had ~ $200M revenue and $27M profit in the last financial year. If they were in startup world those numbers would probably make them over $1BN in valuation.

Post by lisaMM » Sun, Oct 18, 2015, 12:34 AM UTC

7Figures2Commas wrote: post #62

adventured wrote: post #39

Earlier quoted context omitted.

If we're talking only about start-ups that have gotten big during this boom, then you're very wrong. Uber, Xiaomi, Airbnb, Palantir, Snapchat, Didi Kuaidi, Flipkart, WhatsApp, Pinterest, and Dropbox are among the biggest winners so far. There's nothing Wall St or financial engineering about any of those. They're all legitimate businesses and or services that consumers blatantly want.

Look at the investors in today's later rounds and the structures of the late-stage investments. This has nothing to do with consumer demand. There was consumer demand for subprime mortgages too. What we're talking about is where the late-stage money is coming from and how the valuations are being manufactured.

Post by Animats » Sun, Oct 18, 2015, 9:30 PM UTC

benchtobedside wrote: post #88

Animats wrote: post #30

Note that the author is the head of Sequoia Capital. "Sequoia, notably, also counts the highest number of private, billion-dollar ‘unicorns’ of any investor today and consistently finds itself in the largest tech startup exits."[1] If the head of the VC firm financing the largest number of "unicorns" says publicly that many of the "unicorns" are subprime, it's time to pay attention. [1] https://www.cbinsights.com/blo…

Serious question - what does he stand to gain from writing this piece?