If there's anything Silicon Valley is good at, it's staying on message. We've seen it with recent attempts to reframe a Wall Street Journal investigation into the biotech company Theranos as an attack on innovation, and now, a similar strategy appears to be afoot to defend tech companies against fears of a bubble.
Earlier today at the Fortune Global Summit, venture capitalist Marc Andreessen was asked whether unicorns (the pet name for companies deemed to be worth a billion dollars or more by their investors) are over-valued.
"Oh, I don't think we're in a bubble, I think we're in a bust," Andreessen shot back. That response is exactly what Y Combinator president Sam Altman wrote in a blog post yesterday entitled The Tech Bust of 2015. "Maybe instead of a tech bubble, we're in a tech bust," Altman argued.
"Bust" is a catchier framing for a point investors have been trying to emphasize: That the upside of technological disruption is so enormous that even if the next few years leaves a unicorn graveyard in its wake, tech companies are still undervalued by the public market.
Helft's article staunchly defended the beleaguered human resources company Zenefits, which has raised $596 million and is assumed to be worth $4.5 billion by investors such as Andreessen's firm, Andreessen Horowitz. The venture capitalist praised the article by saying that Helft went "full contrarian," a "rare" plane of thought more closely associated with futurist financiers, like self-described contrarian Peter Thiel than with journalists. Venture capitalist Keith Rabois later echoed the same sentiment about a hypothetical basket.
In addition to Zenefits, Andreessen Horowitz is an investor in other "unicorns," like Tanium, Instacart, and Pinterest (as well as BuzzFeed). Andreessen goes into more nuance in the clip above, putting valuations of private tech startups in the context of public tech companies burdened by "shareholder bases that do not want them to do new things and instead want them to give back cash." But "tech bust" sure works better as a campaign slogan.
Nitasha Tiku is a senior writer for BuzzFeed News and is based in San Francisco.
Contact Nitasha Tiku at firstname.lastname@example.org.
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