Tag Archives: Start-ups

Is the Age of the Tech Unicorn at an End?

Once, every tech start-up wanted to be a unicorn? But could the age of the unicorn be at an end? And what will replace them?

unicorn

For the past few years, much of the talk for new technology start-ups has been about achieving the moniker of a ‘unicorn’. Many have tried, plenty have failed, but there are as many that have succeeded.

However, as many people warned, the constant rise of the ‘unicorn’ was always going to come to an end. And even some of the big name unicorns from the past few years have lost this particular title.

So, is the age of the unicorn at an end? And what is coming next to take their place?

Rise of the Unicorn

For those of you still unfamiliar with the term, a unicorn is a technology start-up company, which reaches a valuation of over $1 billion. The companies are characterised by rapid growth, and are generally privately funded, either through VC, or other routes.

The issue with unicorns, one that investors were aware of from the start, is that they are not profitable. Well, at least to begin with. Most unicorns aim to prove concept, and grow market share, before making any money.

Valuations tend to be based on future projections of worth, which is why truly defining a unicorn is tricky. Currently, the Wall Street Journal lists 155 unicorn firms, Fortune 174, and VentureBeat 229.

There are plenty of recognisable names on these lists. Uber, Airbnb, SpaceX and Dropbox, to name but a few. Many of these companies also appear on lists of organisations still considered to be disrupting their respective industries.

It’s probably easier to argue that companies like Facebook and SpaceX, unicorns of the past, have surpassed that title by being profitable in their own right. And profitability, after all, is surely the key.

Pop! Is that a Bubble Bursting?

When we first visited the topic of unicorn organisations a little under a year ago, we did highlight vulnerabilities in this set up. Venture capitalists and their investments are as much susceptible to market changes as any other business.

And given the global uncertainty that has been prevalent in 2016, many investors are looking for safer options. And this decrease in available funding has already seen a major impact amongst unicorns.

The pre-IPO investment firm Sharespost published an analysis in August that concluded that 30 per cent of all unicorns would lose their billion-dollar net worth. Some already have, and some have been pushed down that road in the past 9 months.

Big name companies like Theranos (once a unicorn, now subject of media interest for all the wrong reasons) and Evernote have already had valuations written down. Even Twitter and Uber have lost some of their valuation (though not enough to take them under the magic $1 billion mark).

Rise of the…Cockroach? Really?

Yes, really. Well, if you’re looking for a survivor, it’s well known that cockroaches could probably survive the apocalypse!

It might not be as glamorous a title, or an image, but the cockroaches are here to stay. Cockroach organisations differ from unicorns by having slow and steady growth, a closer eye on spending, and steady profits.

Cockroaches exist where funding doesn’t come as easily, but they can be smaller, more agile, and better prepared for uncertainty. And with smaller budgets, they are regarded as being more creative than their unicorn counterparts.

For investors, this represents a safer option, and a potentially better return in the long-run for them and their clients. While some unicorns will make it, and make it big for their investors, cockroaches are seen as a safer investment, something that is welcome in volatile markets.

Where will we be in another year? Who knows. We can’t predict which companies will still have their unicorn title, and which will be falling back. However, the chances are that the cockroaches are here to stay.

Cockroach or unicorn – which would you rather be involved with? Is the age of the unicorn really at an end? Let us know your thoughts below.

While you ponder that, here are this week’s procurement and supply chain headlines to keep you going.

Bangkok Fire Trucks Belatedly Enter Service

  • A fleet of 176 fire trucks are to finally enter service in Bangkok, a full 10 years after they were purchased.
  • The trucks have locked up in a warehouse for over a decade due to a prolonged legal dispute.
  • The Austrian-made trucks were locked up soon after delivery as part of a wider corruption scandal involving senior government ministers.
  • Due to their age, the trucks require extensive maintenance before they can be put to use.

Read more at The Nation

Self-Driving Delivery Boats to Ply Amsterdam’s Canals

  • The Amsterdam Institute for Metropolitan Solutions plans to use the city’s extensive  canal network to trial a fleet of autonomous boats.
  • The floating robot vehicles will deliver goods and provide driverless transportation for people along the canal network.
  • The boats can also be linked together to provide on-demand bridges and stages.
  • Amsterdam’s research into robot canal boats parallels the proliferation of self-driving cars in the US and elsewhere.  

Read more at The Verge

Amazon Business Hires White House Procurement Head

  • Amazon has hired the former head of the Office of Federal Procurement Policy, Anne Rung, in a bid to increase its sales to government agencies.
  • The role, titled Global Leader of Public Sector Sales, will focus on helping Amazon win government purchasing contracts.
  • Rung will work closely with government buyers to purchase goods and services more efficiently.
  • In her Federal role, Rung reportedly saved taxpayers more than $2.1 billion in procurement spending by reducing duplication.

Read more at B2B eCommerce World 

30 Under 30 Programme Goes Global

  • ISM and THOMASNET.com’s 30 Under 30 Supply Stars programme has returned for its third year.
  • The programme celebrates the achievements of young professionals in Procurement and Supply chain, with the goal of attracting more Millennials into the profession.
  • This year, for the first time, the competition has expanded beyond the US to include nominations from around the world.
  • Judges are looking for multitalented professionals who are influencers and trailblazers in their organisations.

Read more and Nominate at THOMASNET.com

Is It All About The Money?

Money has been at the heart of business since the beginning. But as more start-up businesses take shape, we have to ask, “Is it all about the money?”.

Money

This article was originally published on LinkedIn.

Being at JP Morgan, the annual conference where the worlds of biotech and investment collide, gave me the opportunity to catch up and bump into many colleagues and friends. Everyone had a chock-a-block schedule, trying to squeeze in as many meetings as possible with current and potential partners, and money was a top conversation subject.

Of course money is needed to build and grow businesses, but does it define success? Being in San Francisco and talking to many people over the past week has made me think about purpose. All this talk about money made me wonder if it was really the driver. If it was, I am not sure success would be possible.

One could debate that money equals success or success equals money, but I really believe that it takes a lot more than the desire to make money to be successful.

What Drives Individuals?

For example, I caught up with a CEO that recently made an exceedingly large amount of money, but within just a few days of acquisition is already building another biotech company. I spoke with a VP of sales on his fifth successful startup who is working around the clock to grow yet another company’s revenue.

I met a successful physician that has been developing a product for the past 10 years, with a dream to see it approved and change the standard of care. I met with an investor with a very successful track record, diligently meeting with multiple prospects to identify his best new investments. Even without knowing each individual’s personal situation, I can safely say that the main driver is not money.

So what drives them?

I think it is passion. For some, it’s the rush that comes with seeing businesses grow. For others, it’s a desire to see their idea change the status quo. I can easily identify with that feeling.

I could have been satisfied with Matchbook, my successful and growing nine-year-old consulting business focused on providing procurement and sourcing support to fast-growing small biotech companies. I could have also chosen to be home with my three daughters. Although I have other options, I have chosen to work around the clock for the past 18 months to build tealbook.

Supporting Passion

What drives me to make so many compromises and remain so focused on building this business? It is passion for seeing tealbook come to life and become a market leader in providing supplier information. This passion is supported by many factors, and every crazy entrepreneur has his or her own list.

Here are a few of mine:

  • I believe in the idea: I strongly believe that tealbook can help clients significantly reduce time spent identifying the right suppliers and increasing cost efficiencies.
  • I want to solve the problem: I’ve seen firsthand the challenges of inefficient supplier information while supporting sourcing needs for large number of pharma and biotech companies. There is a solution!
  • I see the market opportunity: So many software companies have focused on developing Procure to Pay solutions and back end financial analytics. But compliance of the tools and user experience has not been done successfully. Technology is only as good as people using it and its data. User experience and compliance is at the top of our list when it comes to gathering and accessing supplier intelligence.
  • I want tealbook to be a market leader: We have developed smart and user friendly technology. I know we can give clients access to supplier information better than anyone else – we have talked to enough people to validate this statement both in the life science industry and beyond. We can own this position and easily become the most used front-end platform to significantly reduce the time spent identifying the right suppliers.
  • I made a commitment: I have made a commitment to myself, clients, suppliers, my team and the rest of the industry. Once I decided to launch tealbook, I made a promise to see it come to life, change the industry and make it a success.

One day, I hope to spend more time with my girls before they get too big. But, I can’t see myself stopping with tealbook. What drives me comes from inside and continues to grow with each interaction and success, small or large.

Although money certainly allows us to properly support our customers, grow our technology, generate more visibility, provide employee security and remain  attractive to potential investors or partners, I strongly believe that if we are truly passionate and motivated about growing a company, money will be an outcome.

You can’t put a price on the exhilaration of success!