I agree with the sentiment of lofty multiples, but what do you think happens to good product companies in that scenario? Sure their stock tumbles quite a bit but would it actually affect the business itself?
I heard the dot com bubble "garbage" was full of companies with no revenue, no customers, etc. I'm not sure many of the high growth tech companies burning $$s are cut from the same cloth though as they really do have products and customers in the present; it's just that the market expects an insane number of new services/customers in the near future...
For example, I'm guessing customers can't just cut off Snowflake easily (time wise and effort wise) so the cashflow would remain stable for a while. As long as they don't need to do a secondary offering (and have some cash), wouldn't they be able to weather a storm? Perhaps at the cost of some massive layoffs/refinancing but would still prevent an actual collapse?
I heard the dot com bubble "garbage" was full of companies with no revenue, no customers, etc. I'm not sure many of the high growth tech companies burning $$s are cut from the same cloth though as they really do have products and customers in the present; it's just that the market expects an insane number of new services/customers in the near future...
For example, I'm guessing customers can't just cut off Snowflake easily (time wise and effort wise) so the cashflow would remain stable for a while. As long as they don't need to do a secondary offering (and have some cash), wouldn't they be able to weather a storm? Perhaps at the cost of some massive layoffs/refinancing but would still prevent an actual collapse?