The technological bubble is deflated. Investors overestimate risks

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About a year ago, venture capitalist Bill Gurley announced a change in investment rate. In his opinion, investment in technology companies is already an excessive risk. Now, according to Gurli, other investors come to the same conclusion, write Vedomosti. Bill Gurley gave a detailed interview to The Wall Street Journal WSJDLive, during which he reported on startups that lower their own estimates of expected funding. As for mutual investors, they reduce the cost of their packages in technology companies.

Gurli now believes that investing in technology companies requires great caution. After several years of very rapid growth of many startups, both the volume of investments and the expenses of such companies growing, they still do not have a clear way to make a profit. And now, venture capital funds have a rather bad period, which is associated with a low level of return on investment. Many private companies are refusing an IPO, and startups are worth much more than what larger technology companies can count on.

company BenchmarkGurley, whose main partner is investing and making transactions much less than the last ten years. One of the main problems of Silicon Valley is the reluctance of managers to make their companies public. Accordingly, startups are not studied by investors in the public market - those who want to invest simply do not have a reliable tool for monitoring the financial condition of a private company.

No matter how much a private company is valued, investors cannot get an investment until a startup goes public. The liquidity of the company can serve as the only real estimate of any startup, says Gurli, and all private assessments are just numbers on paper.

At the very beginning of the Uber service, Benchmark was one of the first investors of the service. Uber is currently one of the most expensive private companies in the world, with a valuation of $ 51 billion. Benchmark has also invested in WeWork Cos., A coworking startup that leases office space. And now this company is estimated at $ 10 billion, which surprised the investor very much.

The low level of lending rates allows investors to invest in private technology companies, which allows the latter to hold a high rating for a long time. If rates do not change in the near future, then we can see the volatility. In any case, Gurli thinks so.