In case you haven’t been following it, the stock market has been taking a huge hit, especially in the tech sector. Truth be told, tech stocks have long been overvalued, and although no one wants to mention the word, let’s go there: the bubble is finally bursting. It’s overdue. Waaay overdue.

 

Consider: Facebook revenue slows but user gains boost stock. Strange math, what, eh?  “The company shares had fallen by about 44 percent in addition to recording a $400 billion loss in market value,” TechStory reported. But the stock was up! But not for long. Of course, Zuckerberg has assured us that his metaverse will be hugely profitable by 2030, no matter that it lost $3B this past year. The hype machine, it seems, is alive and well.

The good news, re the market: investors tend to take their money out of the market in times like these, but it doesn’t necessarily stop them from investing, re deploying their money for an ROI. If you follow the Strictly VC newsletter, you might have noticed that VC funds are raising large if not huge rounds. And more funds are being launched almost daily.

We will also remind you that some of the now household names launched during a down market, most notably Google, which launched just before the last tech bubble burst. It was founded in September of 1998, when hard times had already hit Silicon Valley and not a good time to launch a company, much less look for funding.

Yet there you have it.

All of which seems to have given rise to one of our new favorite terms:

Soonicorn.

From our point of view, it’s a new breed of startup/tech company that maybe should have been in the stable since the beginnings of tech. Yes, you can still raise funding, although very important to keep in mind when you’re meeting with investors that their focus is on one thing and one thing only:

The exit.

They’re in business to make money, which is why they’ve been pulling out of the market and looking elsewhere to invest, so they’re now paying even closer attention to the points you need to cover in your pitch deck, especially size of market and traction. You do need a market that will use your product, and hopefully will even pay for it in some form, be it outright, via a premium model, or even advertising. Is your product truly valuable to someone or many people out there, depending on your model, and will the investors see that all important Return On Investment, preferably in their lifetimes?

Soonicorn – good term to know and a good one to keep in mind as you’re building your business, and there’s another good word to keep in mind: business, because that’s where your focus needs to be. On not simply starting a company, but building a business, where points like ‘revenue models,’ ‘traction,’ and ‘ROI’ count. You may not make headlines for being the latest and greatest that has managed to hit unicorn status in three minutes or less, but we all see where that has led and has been leading for quite some time.

 

‘High time to focus on business and to remember that some rules never change. Like the one that says that slow and steady wins the race. Not to worry. Stay the course and you’ll get there soon enough. Onward and forward.