Unicorns, free beer and meat-free burgers!

We live in magical times indeed; according to cbinsights.com, there were an additional 119 unicorn sightings in 2018 (a unicorn, of course, meaning a private business valued at over $1bn… not one of those mythical-skinny-rhino-things). Many of these unicorns are now planning to go public, and so by comparing and contrasting some of the most interesting ones, students can gain some valuable business insights and consolidate their knowledge in time for their first exam on the 24^th May.

First up is UBER, America's biggest unicorn which is set for a $90bn valuation. This is made more interesting by the fact that they are yet to make a profit, and the CEO stated "we expect our operating expenses to increase significantly in the foreseeable future, and we may not achieve profitability." However, their revenue has increased from $3.8bn in 2016 to $11.2bn in 2018 ( a 194% increase), and have stated that they “will not shy away from making short-term financial sacrifices where [they] see clear long-term benefits”, indicating their culture of long-termism and the market’s confidence that UBER’s growth will continue.

The BBC article also discusses issues with recovering from their “toxic culture”, the treatment of their workers and its diversification into e-scooters. With Lyft’s stock price dropping 15% since its IPO, can Uber actually be worth what the market capitalisation states?

Next up, WeWork, the Airbnb for offices, the firm offers shared office space and services, allowing clients to shrink or grow their number of desks for the period they need them for (flexible working / capacity utilisation etc). 9 years in, they are already London and New York’s biggest private office occupiers, but again, they are yet to make a profit, and their losses doubled to $1.9bn last year! Despite this, the business is valued at $47bn.

The BBC article discusses the reasons for their growth, including free beer for tenants in their New York offices, possible the best and worst business idea I’ve heard in years!

Finally, Beyond Meat, the ethical plant-based burger business that aims to reduce the huge environmental impact or rearing animals, has raised its predicted share price to $25 due to a huge appetite (pun completed intended) for vegan products. Its investors include Bill Gates and the Wolf of Wall Street himself, Leonardo DiCaprio, but once again, they have reported losses since 2009, and have admitted that they “may be unable to achieve or sustain profitability”, a perfect counter-argument for Caroll’s CSR pyramid.

Overall, three great articles from a range of businesses that can help students consolidate their knowledge on all of the following:

Market Capitalisation

Private & Public Limited Business

Sources of Finance

Culture

Growth & Profit

Short term costs v long term strategies

Ethics & Caroll’s CSR Pyramid

Flexible Working

Technology and Innovation

I hope this helps and I wish you all of the very best to you and students in the build up towards exams!