The Corona virus is the new 9/11

The Softbank / We Work debacle is the old Enron and the Corona virus is the new 9/11. The analogy is profound. Watch every company now clean their balance sheets out using this as an excuse. Slowdown of VC funding and a move to profitability certainly resembles the end of the .com era. New opportunities shall occur!   
...Aivars Lode

U.S. stocks extended a punishing selloff Friday, finishing their worst week since the financial crisis with mounting investor unease about the economic fallout from the coronavirus epidemic. 

The Dow Jones Industrial Average shed 357 points after being down more than 1,000 points before paring declines. The blue-chip index avoided falling by more than 1,000 points for the second consecutive day by staging a roughly 640-point rally in the last 15 minutes of trading. 

The S&P 500 fell 0.8% and the tech-heavy Nasdaq Composite recovered after being down more than 3% to close roughly flat in a volatile session. 

As the Start-Up Boom Deflates, Tech Is Humbled

Is this the beginning of the end for VCs and their funded companies?  ....Aivars Lode

SAN FRANCISCO — Over the past decade, technology start-ups grew so quickly that they couldn’t hire people fast enough.

Now the layoffs have started coming in droves. Last month, the robot pizza start-up Zume and the car-sharing company Getaround slashed more than 500 jobs. Then the DNA testing company 23andMe, the logistics start-up Flexport, the Firefox maker Mozilla and the question-and-answer website Quora did their own cuts.

“It feels like a reckoning is here,” said Josh Wolfe, a venture capitalist at Lux Capital in New York.

It’s a humbling shift for an industry that long saw itself as an engine of job creation and innovation, producing the ride-hailing giant Uber, the hospitality company Airbnb and other now well-known brands that often disrupted entrenched industries.

Their rise was propelled by a wave of investor money — about $763 billion washed into start-ups in the United States over the last decade — that also fueled the growth of young companies in delivery, cannabis, real estate and direct-to-consumer goods. Unlike low-cost software start-ups, these private companies frequently took on old-line competitors by spending heavily on physical assets and workers while losing money.

Now a pullback is unfolding in precisely the areas that drew the most hype.

Around the world, more than 30 start-ups have slashed more than 8,000 jobs over the last four months, according to a tally by The New York Times. Investments in young companies have fallen, with 2,215 start-ups raising money in the United States in the last three months of 2019, the fewest since late 2016, according to the National Venture Capital Association and PitchBook, which track start-ups.