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Last Time It Was This Crazy, the Stock Market Crashed
Submitted by testosteronepit on 10/09/2014 23:16 -0400
Marc Andreessen, founder of long-forgotten Netscape, then warned in a series of tweets: “When the market turns, and it will turn, we will find out who has been swimming without trunks on. Many high burn rate companies will VAPORIZE.” His final and most eloquent tweet: “Worry.”
It’s anecdotal evidence, but it’s everywhere in San Francisco and Silicon Valley. A neighbor was cooling her heels by the curb, suitcase next to her. She’s going to Europe on a “vacation-thing,” organized and paid for by her company, she told me. A team-building perk. She’s a coder at a startup, her first job out of college. When she moved in less than two years ago, trucks kept pulling up to deliver her latest acquisitions. One day, she gingerly parked a new BMW in the garage. As we were chatting about her trip to Europe, a limo pulled up for her ride to the airport. That too was part of the perk. No expenses will be spared.
This startup occupies super-expensive San Francisco office space that’s way too big for the number of employees. It’s embellished with designer furniture. Free lunches are de rigueur. All paid for with the boundless money it is getting from investors.
But who cares, except for a few wayward souls in the VC community who lament those sizzling burn rates. Bill Gurley, partner at Benchmark, had stepped to the forefront a few weeks ago to warn that “the average burn rate at the average venture-backed company” is at an “all-time high since ‘99 and maybe in many industries higher than in ‘99” [“Excessive Amounts of Risk” Doom Startup Bubble].
http://www.zerohedge.com/news/2014-10-09/last-time-it-was-crazy-stock-market-crashed