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1/ Glorification of high private market valuations for startups is a plague. A “billion dollar company” isn’t guaranteed to be one just because one firm said it is. It may not even be a going concern. Exhibit A - WeWork.
2/ Potential startup employees take notice - a big private price just means your options are expensive, and worth less to you. A big mission you’re excited to be on, customer value, a leader, culture, team and board you are inspired to join. Those are the fundamentals.
3/ For later stage companies, capital efficient user adoption, revenue growth, category leadership and a business model that makes sense.
4/ People making career decisions should of course take every signal they can get about an opportunity — but it’s hard work figuring out if a startup is a great one, and private valuation isn’t the right signal.
5/ Think of it this way — it would be bass-ackwards for any investor to say, “Oh my goodness, a company last valued at a billion dollars! Must be a winner.”
6/ So startup employees would do better to put their VC hats on when thinking about their next move, and lean toward companies whose CEOs transparently talk fundamentals, not glorify valuation.
