24 Aug How the stock selloff could kill off some tech unicorns
Tech stocks are among the hardest hit in Monday morning’s dramatic stock market selloff, with shares of Apple and Facebook losing more than 5 percent of their value. But what’s really terrifying the technology sector is what a global markets slide will mean for the many richly funded startups that aren’t even trading yet on exchanges.
With so much volatility in stock markets, Silicon Valley firms will hold off initial public offerings and cool a white-hot market for venture funding that has fueled the most lucrative environment for startups in history, some analysts say.
Already, RainDance Technologies, a firm that makes genomic tools to detect cancer and other diseases, announced Monday they have pulled their planned to go public, according to Reuters.
And the big question is what will happen to the hundreds of startups — 131 valued at more than $1 billion — that are now all dressed up for IPOs but with no place to go.
Prominant venture capitalists in Silicon Valley is warning of casualties. In a series of tweets last week, Benchmark Capital partner Bill Gurley, who has invested in startups including Uber and GrubHub, wrote: