unplugged

http://www.zerohedge.com/news/2015-12-30/unicorn-mauling-fidelity-slashes-valuation-startup-superstar-uber-75

http://graphics.wsj.com/billion-dollar-club/

This is what the FT said at the time: "Snapchat has been marked down by one of its most high-profile investors, raising further questions about the soaring valuations of private technology companies. Fidelity, the only fund manager to have invested in the four-year-old company best known for disappearing photos, wrote down the value of its stake by 25 per cent in the third quarter, according to data from investment research firm Morningstar. It had valued each share at $30.72 at the end of June but dropped the valuation to $22.91 by the end of September."

The FT's spot on punchline: "It is unclear why Fidelity marked down its stake" adding that Snapchat is still searching for a sustainable revenue model. Clearly one can see why there is so much confusion over what its "value."

However, Snapchat is not alone among the realm of "unicorns" or companies valued at over $1 billion that is "searing for a sustainable revenue", let alone profit, model.

We added that it is also unclear "if other Snapchat investors, such as VC titans Benchmark and Kleiner Perkins, as well as tech companies Alibaba, Tencent and Yahoo have followed Fidelity into what is becoming a widespread realization that not only was there a private tech bubble, but that it has now burst."

We doubt the answer was, or is, yes, adding that "a bigger question is whether it will be a controlled demolition as unicorns everywhere are demoted to what we first dubbed "zerocorn" status in the coming days. To be sure, the VCs are desperate for a controlled demolition, and hoping the broader market ignores the euphoria that took place in Silicon Valley over the past 3 years, is now over, and that giddy investors overshot by at least 25-35% to the upside in the past several private funding rounds as everyone was rushing to pass the valuation hot potato to ever greater, and richer, fools."