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All Quiet On The Unicorn Front

SoftBank’s Hard Landing Among The Tech Unicorns

No new unicorns, no downrounds, but some hints of turbulence on the regulatory front. Plus, Donald Trump weighs in on the tech bubble.

Guess who’s calling for a bubble in techland now – and specifically in the rarefied corner of unicorns? Donald Trump.

Now, when Trump speaks, people listen. Well, some people. Not tech mavens. And evidently not the tech mavens who ride unicorns.

The presumptive Republican nominee weighed in on the tech landscape, and echoed the sentiment that has been laid down in other places before, namely, that there’s a bubble a blowing and it hearkens back to bubbles past, such as those seen before the latest stock market crash and even back to the end of the last millennium.

In an interview with Reuters, Trump noted that “I'm talking about companies that have never made any money, that have a bad concept and that are valued at billions of dollars, so here we go again.”

No less than Twitter, the very instrument that has been so helpful to Trump, bubbled up itself to mock his comments, with asides from people in the business, so to speak.

"FINALLY someone calls it out," a rather tongue-in-cheek Marc Andreessen, of VC firm  Andreessen Horowitz, tweeted.

And therein lies a good segue into this week’s Unicorn Watch.  The list does not change, and it may not change for a bit, given the caution that has been creeping into the sector.

In one bit of news that may presage a jump from startup to startup adviser, Klarna founder Victor Jacobsson has evidently registered two new companies in Sweden, identified in documents as Dovern Advice and Rosenfeldt Holding, along with hedge fund investor Michael Walther.  Not much is known at this point beyond those two filings, but Jacobsson has a 50/50 split with his fellow investor.  If indeed this is the signal of a formation of new advisory/investment vehicles, evidently someone (or someones) do not think a top is in for the tech sector, and likely the payments subsector, quite yet.

What about downrounds? None this past week, not in payments.

But here’s a thought: With the recent exits of Uber and Lyft from Austin, Texas, one wonders if some of the clashes that are setting up between tech upstarts and the industries they displace (such as, in his case, taxis) over regulations may presage some caution on the part of investors going forward.  The jaundiced eye cast at some of these new business models, from the powers that be, might mean that regulatory climes are going to get hotter.  It’s not a direct read, immediately, for other tech unicorns.  But then again, a similar caution is settling over alternative lenders – Lending Club being the prime mover here.  Torpor may be here in May, but the summer may get a little hotter for FinTech.



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