Unicorn valuations are bad for your health -- the Prisoner's Dilemma of WeWork and Magic Leap; plus 20 key Fintech developments
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Hi Fintech futurists -- In the long take this week, I look at why unicorn valuations can be destructive for the Fintech industry. While some companies do have incredible financial performance, much of the valuation premium in the private markets today is a negative Prisoner's Dilemma equilibrium, which leads to price compression, over-scaling, and problems with exit for everyone but the CEO. We look at this question through the lens of WeWork and Magic Leap, and the recent developments in the news about the economics of those companies.
Unicorn valuations are bad for your health -- the Prisoner's Dilemma of WeWork and Magic Leap; plus 20 key Fintech developments
Unicorn valuations are bad for your health …
Unicorn valuations are bad for your health -- the Prisoner's Dilemma of WeWork and Magic Leap; plus 20 key Fintech developments
Hi Fintech futurists -- In the long take this week, I look at why unicorn valuations can be destructive for the Fintech industry. While some companies do have incredible financial performance, much of the valuation premium in the private markets today is a negative Prisoner's Dilemma equilibrium, which leads to price compression, over-scaling, and problems with exit for everyone but the CEO. We look at this question through the lens of WeWork and Magic Leap, and the recent developments in the news about the economics of those companies.