Zero interest rates kept many weak companies alive but they also have give great companies time to find product market fit, and the hard part is to separate the two in hind sight

My impression is a lot of these companies raised mega rounds right before interest rates went up, and are now able to tread water by cutting headcount enough that their revenue + interest can sustain them. To what end? Who knows...

Cameo (an example in the article) is an interesting one. It seems like a stable, steady business, making money, should be easy to accurately value if you have access to the financials. No surprise that the "It's $1bn!!!" valuation came from Softbank Vision Fund. https://en.wikipedia.org/wiki/Cameo_(website)

Why post a link that people have to pay to read?

Same article:

https://www.businesstimes.com.sg/opinion-features/zombie-uni...

Companies being devalued is not news. It happens on the stock market everyday.

For companies that rely on outside investment to survive however it can become a slide to oblivion.

If the company itself is profitable, then typically it can continue. There's no interest rate on VC investment, and if profitable it can run forever. Customers, employees, users and so on are all fine. Investors? Well, they're potentially getting some returns through dividends, but its minor and not what they were chasing.

Of course the VC investment model is high risk. That's kinda the point. It's a bet on IPO or (valuable) acquisition. Most companies end up as neither.

Will this affect new VC funds in the future? Maybe in the short term. But there are still enough IPOs (like SpaceX now) and still enough greedy people willing to play the lottery. Sure the absolute amount of VC money may come down, but I don't think the model is going away.

Indeed it may start to lead to saner valuations along the way.

So, series h, i, j companies are worthless?

Zunicorn

Zune-icorn?

Zombicorn!

I know of some actual in use Microsoft Zune that have outlasted many companies that were predicted to become unicorns.