I think what we're seeing is institutional money moving around. Mutual funds, pension plans, and other such entities need to retain a certain ROI to ensure their primary objectives get completed--i.e. making pension payments every month. We need to look at the downturn on the public markets in the context of the public markets and who is doing the selling. If institutions are selling across the board, that's going to depress everything. A lot of it depends on the valuation model and how the companies generate revenue. The problem with tech companies, especially ones that aren't "essential" is that in an economic contraction the value they provide is negligible. If LinkedIn disappeared tomorrow, the job market would go on much like it always has. The only people who would have a more difficult job are recruiters and even then platforms like ZipRecruiter and Indeed.com make it possible for them to do their jobs. On the other hand, if FB / Google disappears tomorrow, there'd be a gaping hole in the internet. The primary social media platform vanishes, all the cat pictures disappear, and we go back to mailing(!!!) grandma pictures of the kids. Similarly, if Google dies, a lot of people's concepts of search go with it. Google has become a verb. Ergo, I think investors know this and move the money accordingly. In boom times, people are flush with cash and can spend it on "non-essential" goods and services. When contractions start, things that aren't essential begin getting reprioritized and the company revenues start falling - and investors will move their money to places more likely to survive an extended downturn.

With regards to VCs and Unicorn investing, we really only saw institutional money get serious about investing in tech startups after 07/08 when the markets shifted and traditional asset classes didn't return as much as they used to. It's easy to look at startups, see the ones that survive and their high ROI and think it's a great place to invest without seeing all the other ones that morph into lifestyle businesses and don't go anywhere or flame out. Throwing near limitless amounts of institutional money into a very noisy market leads to the rise of cheap capital and the ability for anyone to get funding regardless of the extent of their business plan. I think we will see a retraction of available capital which will lead to an increase in bootstrapping and an increase in vetting by serious VCs who need to improve the hit/miss ratio since capital will be tighter.

I need to drum up more capital to invest. Best time to buy and hold is in a major downswing. You get durable assets for cheap!