[JumpCrisscross]

> Where do you delineate between early and late stage? Series A?

Conventionally, it’s around Series C, though anyone who’s worth more than $1bn counts in my book.

For purposes of this discussion, the annual failure probability for American businesses seems to drop below 5% around the fourth year [1]. At that point, if your options aren’t underwater, it’s fair to consider them to be less like lottery tickets. (I couldn’t find failure probabilities by VC round or capital raised, so this is probably conservative inasmuch as small businesses fail at a higher rate than venture-backed companies.)

[1] https://www.bls.gov/bdm/us_age_naics_00_table7.txt

[alephnerd]

Also depends on the trajectory of the late stage startup - especially with a number of the startups that raised during COVID.

A lot of FOMO investors in that time period made some not-so-great bets which lead to unrealistic valuations and then firesales.

Wiz's $80M ARR but $9B valuation def takes the icing on the cake. (Edit: Lacework, not Wiz - was a brainfart)

[toomuchtodo]

They just raised $1B at a $12B valuation, but that’s likely predicated on them going on an M&A spree to roll up less healthy competitors or offering compliments before they IPO, vs organic growth.

[alephnerd]

I brainfarted. I meant Lacework, not Wiz.

Wiz actually has an M&A strategy (Aqua is definetly on the table, as well as Tamnoon) seems to and some greenfield product development in progress.

Lacework on the other hand mismanaged a lot of hiring, and there were some shenanigans in the sales org.

Wiz actually has a healthy pipeline and execution, but Lacework never had that when they did their raise.

[toomuchtodo]

This is helpful, appreciate the context.