Silicon Valley braces itself for a fall: ‘There’ll be a lot of blood’

Saturday, January 23, 2016
By Paul Martin

Wannabe entrepreneurs are still piling in to San Francisco, but there’s a sense that time is running out on the exuberant startup world

Nellie Bowles
Guardian.com
Friday 22 January 2016

A sharply dressed French investor is leaning against a doorway, arms folded and his expression slightly bemused. Philippe Suchet is considering the latest raft of hopeful new technology entrepreneurs that have presented at 500 Startups – a major hothouse for up-and-coming Silicon Valley talent.

There’s no shortage of enthusiasm and ideas in the valley, but Suchet is sceptical.

“Things have been frothy, and you see a lot of dumb money. The music’s going to stop and not a lot of people will have a chair,” said 48-year-old Suchet, a 500 Startups mentor who says he’s been seeing companies now with $10m valuations and no product. “There will be a lot of dead bodies. A lot of dead bodies. There’ll be a lot of blood.”

One of the founders walks by handing out his newly venture-backed meal replacement called Ample, whose label says: “Formula version 1.3 better because science.”

Suchet raises his eyebrows and nods.

The last few months have been hard on Silicon Valley startups, as a series of “down rounds” across the tech world chop established companies in half and stock collapses move billionaires back to millionaires. There’s a sense that San Francisco’s excess is peaking; investors asking for their money back, house-flipping seminars popping up across Facebook, and gold-flaked pizza signal the end of times.

The Rest…HERE

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