SNS: Enablers and Vectors: Accelerating Innovation Deployment, Part II: Unicorns and Profitless Disruptions

In This Issue
Week of 4/17/2017
Vol. 22 Issue 14

SNS: Enablers and Vectors: Accelerating Innovation Deployment, Part II

• An Unintended Consequence of Google
• VCs Do Their Own Pivot: From Price Tolerance to Price Acceleration
• Unicorns, and Those They Kill

Quotes of the Week

Takeout Window

• North Korea Unveils Novel New Missiles
• Next Steps in the Orca Relief Citizens Alliance’s Proposed Whale Protection Zone

Ethermail

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Members may remember that I opened our last SNS Global Report with this observation:

The two most important (and overused) words in Silicon Valley are “innovation” and “disruption.” In the next two issues of the SNS Global Report, we’re going to explore the forces behind them. In this week’s discussion, we’ll go deeper on the return on investment for invention, based not on total ROI, but on how quickly those revenues are realized. And in our next GR, we’ll pull out the frauds and tricks behind the innovation economy and the darker side of profitless disruptions.

In this week’s discussion, I will take a look at the part of Valley startup culture that gets almost all of the outside attention, and a gigantic fraction of investor money, and which is, unfortunately, as financially unstable as it is exciting: cash-burning, profitless unicorns, many of which wreak havoc on their profit-making competitors.

Specifically, I will not be addressing the 90% of tech startups which, according to a recent Stanford University report, fail in their first three to five years (unlike our annually selected FiReStarter companies, 90% of which succeed and raise additional
funds).

Rather, I will describe a phenomenon that began with the Facebook Generation of companies, many of which consumed breathtaking amounts of investor capital as they scaled into global headcount numbers while rarely, if ever, making a cent.