Opinion
Why there is no bubble in true tech company valuations
The argument seems to be mounting, both locally and internationally, that VC-backed, privately held tech companies are not “real businesses” and that a reckoning is coming for us all. This is not the case.
John HendersonContributorMuch has been made of WeWork’s calamitous Nasdaq IPO attempt and subsequent bailout from SoftBank. When sceptics talk about tech bubbles and private market exuberance, this is exactly the kind of company they have in mind.
Before its IPO attempt, WeWork had raised more than $US13 billion ($19 billion), most recently at a $US47 billion valuation. For the six months to June 2019 it had net losses of $US904 million and was reliant on both the IPO getting away and an attached $US6 billion debt facility in order to continue.
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