Tag Archives: #investing

Hiring changes

 

Has hiring really changed?

The need to find and hire talent has always been one of the biggest challenges for most managers, no matter their position or how long they have been doing it.

Although the need never goes away, accomplishing it seems to be a moving target.

Startups are no different.

For decades joining a startup meant giving up benefits, perks and salary in return for the opportunity to work on the bleeding edge of tech and doing something that could have global impact.

Then the easy money faucet turned on and many startups found themselves drenched with cash.

So much so, that they started offering Google-style perks, six-figure salaries and sign-on bonuses to, mostly, young, white males who could code and were willing to work “insane hours” as a badge of honor.

picture on hiring

image credit: here

Recently the easy money faucet was turned way down as investors returned to the old fashioned values of profit and sustainable business models. Continue reading Hiring changes

Fidelity and valuations

My friend Miki Saxon knows I enjoy learning about the financial side of startups and last week she sent an interesting article.

In an appearance on Bloomberg TV, Y Combinator President Sam Altman said that “the whole back and forth and obsession over these markdowns and valuations is a dumb conversation.”

More than a decade ago Private Equity (PE) started investing in later startup rounds, including Facebook. The has accelerated, because of an ongoing trend that has seen more PE, mutual funds, investment banks, etc. moving into the private markets to get access to the current crop of fast-growing startups.

It was investment from companies such as Fidelity, Elevation Partners and Digital Sky Technologies (there are dozens of others) into companies, such as Uber, Dropbox, Snapchat, and Zenefits, that drove the multi-billion dollar valuations for companies with no profits and, in some cases, little actual revenue.

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Image source: here

Mutual Funds, such as Fidelity, do not revalue their holdings privately as do VCs. In November 2015 the investment giant publicly revalued the prices it paid earlier that year. Fidelity marked down its investments in many so-called unicorns, such as Dropbox, Snapchat and Zenefits, which, in turn, lowered their valuation.
Continue reading Fidelity and valuations