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Comment by ineedasername | Hacker News Reader

Staying private longer in the face of capital markets skeptical of money losing businesses isn't much of an option. Eventually, in order for the private investors to make money, they either need to get profitable or go public. AirBnB is a poor example of staying private longer in these circumstances because they are profitable. [0]

[0] https://www.cnbc.com/2019/01/15/airbnb-sustains-profit-as-it...

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> Eventually, in order for the private investors to make money, they either need to get profitable or go public.

Most (but not all, obviously) unicorns could easily be profitable if they chose to be. It would come at the expense of growth and R&D, but they would be profitable nonetheless. Growth is just valued much more heavily in the current market.

If you look at S-1s or even recent public unicorn earning statements, most of their losses stem from outsized increases in R&D/etc. expenditures despite healthily increasing revenues. The most recent example I can think of off the top of my head is Dropbox.

Yes, the thing is that profitability in that way would cost them their IPO, whose value would plummet. And private investors that bought in at 10x or 20x revenue would not be happy with 0.2x profitability. More or less what happened with WeWork once they issued their offering & the CEO's behavior caused scrutiny on the whole thing.

Could also go strategic exit or PE route, though former tricky to put together and latter tough on valuation

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