Uber, the popular and controversial company behind the eponymous wildly successful-ride sharing app, got one step closer to going public last week when a $1.2 billion fundraising round pegged Uber’s valuation at $40 billion. The staggering number sets up the inevitable Uber IPO to be a ripoff for individual investors.
For context, the $40 billion valuation implies that Uber is more valuable than the likes of Halliburton Company (HAL), United States Steel Corporation (X), and Orbitz Worldwide, Inc. (OWW) – combined.
Look at the calendar. Remember the day you realized Silicon Valley was reaching a dangerous level of irrational exuberance not seen since the dot-com days. Not all Silicon Valley companies are overvalued of course, but there seems to be a clear and arguably too-high premium placed upon companies that are app- or mobile-centric, youthful, and à la mode (that is, fashionable companies — not ice cream companies). Read