Then, the SPAC and IPO boom of 2020-2021 arrived. All of a sudden, companies in scores of sectors once confined to venture capital portfolios were widely available on public markets. Developers of technologies tied to self-driving vehicles were particularly well-represented, launching market debuts with collective initial valuations of over $50 billion.Ěý

But investors’ love affair with the space didn’t last. A Crunchbase analysis of 14 companies developing technologies tied to self-driving vehicles 1that went public in the past couple of years shows an average post-debut decline of more than 80%.

The worst performers—a list that includes autonomous truck developer and LiDAR technology companies and —are down over 95% or more. Both Quanery and Embark also completed reverse stock splits this year to lower the danger of delisting, only to see further valuation declines.

For a full rundown of how these 14 companies have performed, we put together a chart, seen below, showing valuations at time of debut compared to now:

VCs are still investing

Given the public market’s rapidly decelerating interest in the space, one might expect to see venture investors put the brakes on big rounds for private companies tied to autonomous driving. That hasn’t entirely been the case.

We’re still seeing some big rounds this year. For instance, London-based , developer of what it describes as a “next generation” autonomous vehicle technology driven by machine learning, pulled in $200 million in a Series B, bringing total investment to over $450 million. (It should be noted that this was in January, before public markets posted their most severe declines).

Meanwhile, , a developer of advanced roadways tailored for connected and autonomous vehicles, pulled in $130 million in an April Series A co-led by . Several China-based companies have also secured big rounds, including , a developer of autonomous vehicles, and , which focused on automating vehicle safety features.

Still, things are way down from 2021, particularly for large, later-stage rounds. We aren’t seeing financings similar in stage or size to last year’s biggest round in the space, a $600 million Series D for , which makes self-driving electric vehicles for local deliveries. Obviously, pre-IPO rounds aren’t happening either, given both the state of the IPO market and the condition of already public companies in this industry.

It’s not about profits

As we ponder the causes of the great 2022 sell-off of stocks related to LiDAR and self-driving vehicles, one possibility can immediately be stricken from the list.

No one is dumping shares in these companies because profits are down. They never had profits in the first place.Ěý

It’s also unclear to what extent revenues might be a driver. Those that have sales are by-and-large early in their scaling, while others are still pre-revenue. This was never a bet on present earnings but rather on the future potential of a massive technological shift.

If we look at valuations of the worst performers on our list, it appears investors have mostly given up.Ěý

Take Embark Technology, which develops software to power self-driving trucks. The San Francisco-based company was valued around $5.2 billion when it went public in November through a SPAC merger. It had raised over $117 million as a private company, pulled in another $614 million for its public offering, and counted and among its lead backers.

Just a year after its debut, Embark is valued at less than the cash reserves it had at the end of its last quarter. Shares are down a whopping 97% from their debut price.Ěý

So, just to put it in perspective: This would be like if the price of your $1 million California house went down in a few months to just $30,000. It’s pretty catastrophic.

For Embark, which is pre-revenue, it’s tough to say what could be the catalyst for such a cataclysmic decline. By the same token, it’s also difficult to surmise what supported that $5.2 billion valuation just 11 months ago. Investors just aren’t paying what they used to for this kind of thing.

In coming quarters, it’ll be interesting to see which companies that went public during the 2020-21 window of opportunity have regained investors’ favor. For now, it’s looking like pretty much the whole autonomous driving unicorn herd has headed downhill fast.

Illustration:

Yes, it does sound like fiction. But that actually is the situation facing , founder of e-scooter network .Ěý

VanderZanden, who this past week from his post as Bird CEO, was expecting his stake to be worth hundreds of millions when the company inked a in the spring of 2021 to go public through a SPAC merger. The agreement reportedly set a valuation around $2.3 billion for the then 4-year-old company, of which VanderZanden owned a roughly 13% stake.

As it happened, the timing of the SPAC deal coincided with a growing tech world fascination around Miami, which had been attracting an influx of prominent VCs and crypto entrepreneurs. Though Bird was founded and based in Santa Monica, VanderZanden joined the Florida-bound flock and went house shopping. Bird also later moved its headquarters to Miami.

VanderZanden’s Florida starter home was a splashy one. In August 2021, shortly before the merger closed, the scooter mogul a $21.8 million mansion in a posh waterfront gated community in Coral Gables. Featuring nine bedrooms, 11 baths, an infinity edge pool and private dock, the property checked the boxes one would expect at that price point.Ěý

The home also comes with an interesting history. It was purchased in 2016 by a Panamanian shell company linked to Samark Jose Lopez-Bello, a narcotics trafficker on the ICE . The federal government later seized the property and reportedly it in 2020 for $12.5 million.Ěý

By the time VanderZanden came around in 2021, scooters were looking like a much more attractive and legal path to fast wealth. Bird’s following the SPAC deal announcement called for the company to have an initial offering value in the billions. VanderZanden’s ownership stake, at that point, looked like enough to afford a whole portfolio of similar mega-mansions

High-flying Bird falls to earth

Things didn’t work out that way. Bird stock has been heading steadily downward since shortly after the merger closed in November, hitting a new trough around 33 cents per share this week. Bird’s market capitalization is a mere $94 million now. And VanderZanden’s stake—13% in the last annual report—is worth around $12 million.

Given this decline, it’s not surprising to see that the Florida mansion is back on the market. This time, per , there’s a $39.9 million —a surprisingly ambitious markup for such a short duration of ownership.

Notably, this isn’t the only mega-mansion that VanderZanden has purchased, or even the highest-profile one. In 2020, he paid $21.7 million to buy a Bel Air mansion formerly owned by Daily Show host . (That went up for sale again too, though it’s unclear what the current status is.) Before that, the would-be scooter mogul bought an $8.1 million Santa Monica property, which he shortly resold for $9 million.

It’s also unclear whether Bird is VanderZanden’s only source of wealth. He served as COO of from 2013 until 2014, and left work as VP of global driver growth at in 2016, before launching Bird. (Lyft later him for allegedly breaking his confidentiality agreement, before settling for an undisclosed sum.)

One thing that is clear, however, is that VanderZanden did not become as rich as he expected to become with Bird. Nor did a host of the company’s very high-profile investors, including , which led its Series C and D, and , which led the Series B.Ěý 

The scooter space, in general, just didn’t work out as planned for the early mover crowd. As we documented a couple months ago, VCs pumped billions into the space, only to find that public markets weren’t at all receptive to hoped-for valuations.

For what it’s worth, VanderZanden’s tony Florida enclave also doesn’t look like the kind of place where scooter networks would work. In a gated community where homes come with multicar garages, it’s pretty well assumed that last-mile transport comes with four wheels, not two.

Illustration: Dom Guzman

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Yesterday was a pretty big day in the earnings cycle. Each quarter, public companies disclose their recent financial performance. It’s a key moment for every concern, showing off recent performance to investors, and usually making projections for the future.

Three tech companies that we care about reported their own results yesterday: , which we care about as it’s a high-profile decacorn built with an ocean of private capital (our coverage). , because it’s a recently-public SaaS company growing quickly, making it a measuring stick for how public investors are valuing unprofitable growth (our coverage). And, , as a SaaS company selling SaaS-tooling, is a firm that is an obvious temperature-check for SaaS itself (our coverage).

Let’s quickly examine these, digging up in each case the lesson for private companies.

Uber

Yesterday Uber reported its as a public company. After releasing its results, shares in the company rose and fell before settling up about 2 percent.

What did the firm do to earn the bump? Here are the vital statistics, making comparisons to the year-ago quarter:

• Gross Bookings: $14.6 billion (+34 percent)
• GAAP Revenue: $3.1 billion (+20 percent)
• Adjusted Net Revenue: $2.8 billion (+14 percent)
• Operating Loss: $1.0 billion (-116 percent)
• Adjusted EBITDA: -$869 million (-210 percent)
• Net Cash Used In Operating Activities: $722 million (-143 percent)
• Contribution from Core Platform: -$117 million (year-ago result positive)
• Contribution from Other Bets: -$71 million (-255 percent)

That’s a lot of numbers, I admit. Let me walk you through them. First, spend on Uber’s platform is rising faster than both revenue, and Uber’s adjusted revenue metric. That means that Uber is building gross spend over time that it takes less of a cut from, meaning that its newly acquired gross bookings are less efficient for its business. Uber Eats did over $3 billion in gross booking during the period but generated revenue of just 17.4 percent of that total. In the same quarter Uber’s ride-hailing business brought in 20.7 percent of its own gross bookings total.

Moving on, Uber’s operating loss shot higher, as did its adjusted EBITDA. Its net loss also worsened, but I didn’t share it above as the year-ago result was impacted by a divestment. Finally, Uber’s two businesses both had negative contribution. That means after they paid for themselves, they contributed negative profit to the company.

But as Uber had signaled that all this was coming, its shares rose. The lesson here is that normal rules don’t appear to apply to Uber. The firm just posted slim year-over-year growth for a growth-oriented company while losing a pile of money and watching its core business fail to contribute to the rest of the company’s costs.

If you can figure out why Uber’s stock picked up a few points after all that, email me.

Okta

Since its IPO, Okta has been busy growing somewhat outside the media spotlight. Worth a little over $12 billion, the firm doesn’t have the same profile as, say, which is worth just a smidge more, but that doesn’t mean it’s not an interesting shop.

Following a revenue beat and a promised uptick in spend, shares of Okta rose 6 percent in after-hours trading.

I caught up with its COO, , after its . The firm is in Asia-Pacific to serve that customer base (replete with the ability to constrain customer data to those servers so that their information doesn’t touch the United States for obvious reasons), and announced a few new high-profile clients including the newly-famous .

But all that is company-specific. What can we take away for private companies? That revenue growth is still well-liked by public market investors. Okta grew by 50 percent year-over-year, its subscription revenue grew 52 percent year-over-year, and customers that pay the firm $100,000 or more each year grew 53 percent.

And while Okta’s GAAP net loss sharply grew 41.4 percent to $51.8 million in the quarter, it generated $21.3 million in cash from operations. There’s more information in those figures. Notably that you can spike your all-in losses provided that at-scale growth is hot. And, I’d argue, that you are still a firm with a clear path to profitability. Strong operating cash flow means that Okta can reign in its GAAP results in reasonable time.

So startups, if you want to start the year just over $60 per share and break $110 by the end of May, follow Okta’s performance.

Zuora

If Okta is a bull case-study, Zuora is a bear warning. Shares of Zuora fell by just over a third after-hours, following its .

Zuora, a company that provides billing tooling to subscription companies, beat expectations regarding its quarterly loss while essentially meeting revenue forecasts. But the future is what tripped the company up. :

[T]he company said revenue for the full fiscal year will come in at between $268 million and $278 million, well below the $291.1 million average analyst estimate, according to Refinitiv.

Splat. If the top-end of your revenue guidance is under the consensus mark, that’s bad.

The lesson for private companies in this is that if you are going to continue to lose money as a public company, you still must have the growth to back it up. The market had one set of expectations for Zuora, and Zuora had a very different set of projections. And the market repriced Zuora from the former to the latter after it found out.

I am not sure if we should view weakness in Zuora’s results as indicative of weakness in SaaS. But certainly the company’s struggles can’t be viewed as overly rosy for the sector, Okta aside.

And now, back to our regularly-scheduled private market coverage!

Illustration: .

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The troubled IPOs of Lyft and Uber have taken center stage in the media, their scale obscuring earlier debuts as they settle into life as public companies.

But what about the other companies we’ve seen go public in the tech and venture-backed space this year? Lots of other firms have already made it through the IPO gauntlet that aren’t merely focused on getting you to brunch.

Let’s take a quick peek at the current crop, comparing their IPO price and their current price as of this morning. Ready?

• IPO price: $45
• Current price: $40.61

• IPO price: $25
• Current price: $89.25

• IPO price: $11
• Current price: $10.96

• IPO price: $19
• Current price: $28.46

• IPO price: $36
• Current price: $75.36

• IPO price: $24
• Current price: $53.35

• IPO price: $72
• Current price: $53.13

• IPO price: $11
• Current price: $8.54

That’s the list so far and the results to date. It isn’t hard to see some patterns emerge.

Quickly-growing SaaS is doing well. Ride-hailing is not. And Beyond Meat has excited the market to the point that it is trading on a valuation/gross profit ratio that would make a bubbly price/earnings ratio blush.

So the market isn’t as bad as some might make it out to be. Yes, Uber and Lyft’s failures to launch well are troubling for many who tied their money up into the massively unprofitable companies. But for investors who stuck to companies who retained a path to profitability through high-margin revenue, things seem nice and healthy.

And that’s good news for Fastly and Slack and other companies looking to go public next. Luckin Coffee, on the other hand, could struggle.

Illustration: .