Picture taken from their Twitter
So does that mean all these businesses were always doomed to fail anyways, just living on borrowed money/time, and now the bill comes due, they’re all fucked?
I find it interesting how common it is to blame executive greed/stupidity, as if we all merely got super unlucky when companies were picking their CEOs. Every CEO is different, yet the outcome is almost universally the same: when company longevity and quarterly profits come into conflict, profits win.
The CEO of the modern public corporation embodies that conflict of interest, which is perhaps why they are so hateable – the job is inherently two-faced – but at the end of the day they’re just a face, a name, and a bundle of core competencies. No matter how many CEOs we go through, there will never be one who could satisfy the unending hunger of the public stock market. You will never find one who is not ultimately enthralled. The fundamental concept of know-nothings owning everything is just outright broken.
I don’t know if I think we should burn it all down, but one thing I’m sure of is that the problems won’t stop until we bring the people with investment money into close alignment with the long-term interests of the corporations they own (and/or oust/eat them)
A lot of the wealth created by venture capital and the service economy were only ever possible with the help of what is essentially free money. With the increase in interest rates and the collapse of a major venture capital bank, those corporations dependent on low interest payments are going to collapse as well.
As interest rates climb and venture capital dries up, the companies who were just scraping by, or dependent on debt loading during development have had their runway cut short.
We are getting to the point where companies aren’t going to be utilize fronting a huge amount of debt as a strategy for long term growth.
Unity looks to be one of the companies who wanted to utilize the slow boil tactic perfected by the likes of Google or Amazon. Where they front the cost of tons of free and convenient services, hoping that companies become dependent on them, slowly creating fees over time until they become profitable.
If I were a guessing guy, they’ve hit the end of their run way, and have failed to secure a new injection of capital sufficient enough to make the payments on their loans. Likely their options have come to find a way to make your payments, or you’ll be giving your entire operation to a bank.
I’d guess that companies that failed to turn profit when money was cheap are most likely doomed. However not all of the hype companies are like that. Some could be barely profitable, but shareholder pressure might push them to heavier monetization practices.
Eh. Most of these companies were profitable. Just not seeing the exponential growth that the stock market dictates when interest rates are high. Unity, not so much, but its revenue was always fine, its just a really poorly run company. Who knows where they piss the kind of money they are pulling in to.
