Cartoon: Changed circumstances
“Changed circumstances” by Ian Foley
This new cartoon illustrates the journey that once high-flying tech unicorns are now facing in the current climate.
In 2021, two to three new tech unicorns were galloping out of their stables daily on average. This year, we are averaging 0.1 per day. Furthermore, existing unicorns are seeing compressed valuations when they raise more capital, resulting in several companies losing their unicorn status.
For example, in April, Cybereason, an endpoint security company, reportedly raised $100m at a $350m valuation led by SoftBank at a 90% valuation discount from its prior funding in June 2021, which had then valued the company at around $3bn.
With most venture-backed start-ups on an 18-month to 2-year funding cycle and 40% of the 2021 class already having raised capital, the news can only get worse from here. The remaining 60% of this class of unicorns have either sold or are profitable, or are more likely trying to extend their runway by cutting costs and forlornly hoping that they can grow into their previous valuation despite the very different market conditions.
You can find more of Ian’s cartoons here.
