- Tram Ho
The kings of Silicon Valley are stepping down from their “unicorns”. They post content on social networking sites to show their affection for their “legacy”, expressing hope for the future development of the company. They want to give up leading the startups they have founded.
Choose a stop to end well
In recent weeks, Ben Silbermann – the co-founder of the photo sharing social network Pinterest – has stepped down as chief executive officer. The co-founder of home rental company Airbnb, Joe Gebbia, has announced his departure from the leadership position of the company. Apoorva, the founder of delivery app Instacart, said he will end his term as chairman when the company goes public, as early as this year.
These resignation announcements are signaling the end of the era of tech unicorns. They are among the most valuable and well-known companies to emerge from Silicon Valley over the past decade.
In recent years, investors have poured increasingly large amounts of money into a group of highly regarded startups that have come to be known as unicorns. Founders of startups valued at $1 billion or more are seen as visionary heroes.
They have struggled to protect ownership of their companies, unlike in the past when many entrepreneurs are under pressure to be replaced by more experienced executives.
However, when the stock market plummeted this year, especially when technology companies lost money, things began to change. Venture capitalists backed out and urged Silicon Valley’s prized young companies to cut costs and work cautiously.
In addition to Silbermann, Gebbia and Mehta, the top founders of Twitter, Peloton, Medium and MicroStrategy have all resigned this year.
They left when everything was no longer glorious. Shares of Pinterest are down 60% from a year ago. Shares of Airbnb are down 25% from a year ago while Instacart has slashed its internal valuation by nearly 40% in March, as it gears up for an IPO in a competitive market.
” Now it’s less fun being a CEO. The market is down, the economy is trending negative and it’s getting more and more regulated. If you’re already rich, famous, and successful then often comes a point where sitting in that position isn’t as appealing as leaving and ending things well ,” said Kevin Werback, a business professor at the Wharton School of the University of Pennsylvania.
Give up what I used to fight for
Mark Zuckerberg seems to have pioneered the modern day boss. Zuckerberg asked investors to let him stay in control as Facebook grew, ushering in the current ” founder-friendly ” era.
The founders took advantage of it. They keep their company at the forefront even as it has grown beyond their capacity as managers. They have also kept their company independent for as long as possible.
As the tech sector dominates the economy, fandom and promotion of startup founders has infiltrated popular culture through celebrities like Ashton Kutcher and TV shows like “Silicon.” Valley.”
Some of the founders of this era have gone too far. Adam Neumann’s relentless spending and partying forced him to leave WeWork in 2018, despite holding enough shares to control the company. Travis Kalanick’s ambitious tactics at Uber led to his replacement in 2017, despite the number of voting shares he held.
Others keep doing their jobs and stay in place through the IPO. But as it turns out, running a listed company, taking on extra commissions, and predicting analysts’ forecasts is far from the hustle and bustle of starting a business. Now, as troubles mount amid a market downturn, they are giving up the control they once fought for.
In his announcement, Silbermann said that running Pinterest was “a gift of a lifetime”. Gebbia, who will become an advisor to Airbnb, posted a flashback about the company’s early days. He also posts pictures along with the nicknames of his co-founders and lessons in the kindness of humanity. Mehta tweeted that he “cares deeply” about Instacart: ” That’s what I think of every waking moment for the past decade. ”
Leaving as billionaires, they showed a positive outlook towards the future of Silicon Valley. Pinterest is “just getting started”, Airbnb “has the best of the best” and Instacart has “huge opportunity ahead,” the founders wrote. Both Mehta and Gebbia said they had plans for new projects.
It’s important to be experienced
Investors predict that more and more founders will submit their resignations as they realize they’ll need to work harder but get less. ” Now they can let other executives take over and grow with different tactics, ” said Trace Cohen, an investor in fledgling startups.
Last week, Brad Hargreaves, founder of co-living startup Common, announced he would step down as chief executive officer and become creative director. The company’s head of real estate, Karlene Holloman – a veteran of the hotel industry – will take over as chief operating officer.
The falling market is one of the reasons why Hargreaves made such a decision. He said that in difficult times, it would be nice to have a founder at the top of the company who can convince investors, employees and customers to move towards the vision. ” Many founders sit in the CEO position and have been around for too long ,” he added.
Still, there are founders who have stayed on during the downturn, including Stripe, Coinbase, and Discord. They will have to meet more difficult and demanding requirements.
Stock trading app Robinhood has laid off more than 1,000 employees this year due to the loss of active customers. Dan Dolev, an analyst at Mizuho Securities, said some investors have personally suggested Robinhood should bring in a more seasoned executive to help co-founder Vlad Tenev.
No one can force Tenev out of his position as he and co-founder Baiju Bhatt jointly hold a controlling stake in the company. ” They’re typical founders who are great at ideation and content creation, but can find help with how things work, ” Dolev said.
A Robinhood spokesman said the company recently underwent a reorganization and has only hired management from TD Ameritrade and the Securities and Exchange Commission.
According to NYT
Source : Genk