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Why ‘hold forever’ investors are snapping up venture capital ‘zombies’
Bending Spoons recently acquired AOL and raised $270 million, increasing its value to $11 billion by implementing a 'hold forever' strategy to profit from stagnant tech companies. This trend, highlighted by Curious CEO Andrew Dumont, focuses on acquiring low-performing startups, revamping them for profitability, and argues that traditional VCs overlook the potential of these 'venture zombies'.
Điểm chính
- Bending Spoons acquired AOL and raised $270 million, boosting its valuation to $11 billion.
- The company targets stagnating tech brands like Evernote and Vimeo, making them profitable through cost-cutting.
- Unique 'hold forever' strategy differs from private equity models focused on selling businesses.
- Curious, led by CEO Andrew Dumont, follows a similar model to acquire and revitalize underperforming startups.
- Dumont emphasizes that many valuable startups exist despite not being unicorns and advocates a 'buy, fix, and hold' strategy.
- Ventures that are seen as 'zombies' can be acquired for lower valuations, often 1x yearly revenue.
- Investors prioritize growth for VC-scale exits, creating an environment where profitability is often overlooked.
Vì sao quan trọng
- The rise of AI-natives is making older VC-backed software businesses less relevant, contributing to the need for revival strategies.
- The 'venture power law' dictates that many startups will fail, leaving opportunities for profitable acquisitions.
- The trend reflects a shift in investment strategies, also seen in private equity markets where firms seek to identify and profit from neglected businesses.
Bending Spoons and Curious highlight a growing trend where investors focus on revitalizing underperforming startups, suggesting that the landscape of venture capital is evolving towards sustainable profitability rather than mere growth.