The Unicorns Fell into a Ditch
The first .com implosion was broadly marked by companies that lacked revenue getting crazy valuations.<p>The current “.com” implosion is broadly being marked by companies that do have “revenue” but only by using VC cash to create “fake markets.”<p>The whole story of buying pizzas from a normal pizza shop for $20 and selling them for $18 through your “app” is the stereotypical example of the current .com implosion. Anyone can sell $2 bills for $1, but that’s not a business and no you can’t “make it up on volume” because the only reason people are using your app is because you’re selling something for a crazy low unsustainable price.<p>The take home lesson from the current unfolding implosion is that a great product does not magically just equal a great business.