Anand Sanwal Profile picture
Feb 26, 2020 5 tweets 2 min read Read on X
I had no idea VCs were also experts about coronavirus and pandemics

What don't these guys know?

Unrelated to above tweet…
Haven't seen one VCs say this yet

But now you know

h/t @ReformedBroker Image
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More from @asanwal

Jan 5

A thread compiling my analyses on dead or injured unicorns Image

logistics startup
valuation: $3.6B
raised: $1B

Olive AI

health automation / revenue cycle management
valuation: $4B
raised: $859M

status: dead

Read 8 tweets
Sep 17, 2023
Airtable is probably worth less than the total equity funding it has raised

I'm not talking about the $11.7B valuation it raised at in December 2021

I'm talking about it being worth less than the ~$1.4B+ in financing it has raised

Here's the math/data

Airtable is on track for $150M of ARR in 2023

Per @CBinsights, it was doing $115M in 2021

That's 14%'ish growth per annum

We'll come back to growth in a second

But for right now, that puts Airtable's forward price/revenue multiple at 78x ($11.7B valuation / $150M ARR)

Now, let's compare that price/revenue multiple with publicly traded peers in the broader project mgmt and collaboration space, specifically:

Monday: 12.63x
Asana: 6.61x
SmartSheet: 7.98x

Note: these are not forward multiples but trailing multiples for these companies. And so on a forward basis, the multiples are likely lower

But for the sake of simplicity and to give Airtable the benefit of the higher multiple, we'll use those comps

This would put Airtable's valuation in the neighborhood of

$991 million to $1.89B


That's a 84-92% valuation discount vs that $11.7B val in 2021

Here is where folks will typically argue that the above doesn't consider Airtable's growth

The logic is that Airtable is growing quicker than peers and hence will grow into that valuation and so should command a premium valuation multiple

And therein lies the problem

Once we layer in growth, the picture for Airtable gets worse

Here's YoY revenue growth for the comps

Monday: 68.5%
Asana: 44.6%
SmartSheet: 39.2%

As a reminder, Airtable's growth is ~14%

And here's their trailing revenues:

Monday: $624.8M
Asana: $606.5M
SmartSheet: $711.9M

Airtable: $150M (forward ARR)

So it's public peers are 4x to 5x larger in terms terms of revenue

And they're growing 2.5x to 4.5x faster

Add in a further discount for illiquidity given Airtable is private, the valuation is prob south of $991 million

Asana has the lowest price/revenue multiple of the bunch at 6.61x which is how we arrive at the $991M

Asana is also growing at almost 3x the rate of Airtable off revenue that is 4x larger

It's not hard to imagine that this brings down the multiple of Airtable to 3 to 5x which would equate to a valation of

$450M to $750M

That'd be a discount of 93-96% vs that Dec 2021 valuation

The company is cutting costs and repositioning for profitability which makes sense in this market but given the current likely valuation, all investors after the March 2018 Series B are likely underwater

They're also talking about a future IPO but getting back to anywhere close to that $11.7B valuation would require reigniting massive growth and making that price:revenue to growth ratio look more appealing

As always, if you believe any of my assumptions in the above are incorrect, please comment and I'll update the analysis if the additional context dramatically changes the results

If you want to go deep on the space, we analyzed @airtable & peers as well as products in the space in Jan 2023

The numbers have evolved a bit but the storyline remains the same.

The massive Airtable equity funding tally was something that caught our eye then as well
If you're a fan of math, you might also like this analysis of Flexport's valuation

Read 5 tweets
May 6, 2023
Bragging about headcount was 1 of the most corrosive trends in startup land over the last many years

I was guilty of it too

Somehow larger growing headcount became a positive signal of success for companies

When in reality, it may more often than not be a negative signal
If you look at articles about unicorns, you'd rarely see revenue figures but you'd see founders/CEOs bragging about taking the team to 800 by year-end

Fundraising and headcount became 2 false proxies for success

But what are the real negatives of more headcount?
It may be symptomatic of or lead to ("may" is important here)

- indicate lack of focus
- belief that scale comes from ppl not systems
- a lack of focus on culture
- a non-performance driven culture
- execs motivated by empire-building
- excess complexity & slower velocity
Read 5 tweets
May 5, 2023
1/ Attn: If you're in corp dev or with a financial sponsor/PE

This is an amazing time to look for non-core assets within larger cos that they want/need to divest

Today, we saw Shopify unload 2 recent acquisitions to focus on the core… Image
2/ @Shopify sold @DeliverrInc to @flexport

Exactly 1 year ago, they bought it for $2.1B

They divested to Flexport for 13% of the co's equity

Based on Flexport's last valuation of $8B, that's a $1.04B valuation

That's a 50% haircut vs 1 year ago… Image
3/ Walmart is another example of a co divesting non-core assets

They just divested Bonobos at a loss

Before that they'd divested:

* ModCloth
* Shoes(dot)com
* Moosejaw
* Bare Necessities
Read 5 tweets
Apr 9, 2023
The intense drama about SVB has died down

But the implications on the pvt markets will be felt in coming weeks & months

They will be big for VCs, PE and startups

We’ll dig into what the data says here

First stop - Let’s dig into how debt was being used to prop up valuations
2/ In their Q1’23 update, SVB had a telling line

“Clients continue to opt for debt over raising equity at pressured valuations”

This actually explains quite a bit about private market valuations Image
3/ This was a perplexing pvt market phenomenon

That private market valuations were still holding up even though public market tech valuations had dropped dramatically

And the availability of this debt allowed startups to avoid taking “pressured valuations”
Read 20 tweets
Mar 3, 2023
We bootstrapped @cbinsights by first building a totally different business

It involved hedge funds, too big too fail banks and $100,000 PDFs

For nerds interested in data and information services businesses, you might enjoy this
First, some backstory

My 1st day of freedom from big co employment was Jan 1, 2008

In retrospect, this was comically bad timing given the Great Financial Crisis was abt to happen

But I had no idea
Initially, the idea was to do consulting abt a book I’d written on “Corporate Portfolio Management”

We’d lined up some interested clients and were in the contract process

Had $1M of consulting gigs lined up

Then the mkt tanked

The 1 whale we had was a too big too fail bank
Read 20 tweets

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