Opinion: One of these 15 money-losing companies could be the stock market’s biggest ‘unicorn’ crash.

David Rush holds the Guinness World Record for lighting 100 candles in his mouth. Sandeep Singh Kaila spins a basketball on a toothbrush in a record time of 1 minute 8.15 seconds. Neville Sharpe let out a 112.4 decibel burp.

If those famous scenes can make it into the Guinness Book of World Records, there must be a category for something more important – the failure of the world’s largest startup company. There is certainly no shortage of contenders for this dubious honor.

Before 2015, the biggest losers (by funding) were Solyndra ($1.2 billion), Abound Solar ($614 million) and Better Place ($675 million). Webvan gained notoriety when it received $275 million in venture capital funding and failed in 2001 after three years of operation. Recently, Theranos received $500 million in venture capital funding and was a well-publicized disaster, with CEO Elizabeth Holmes and president Ramesh “Sanny” Balwani indicted on multiple counts of fraud.

Those losses are big, but the cumulative losses of many startups that haven’t yet gone bankrupt are orders of magnitude bigger. The table below shows the amount of money raised by the 15 largest money-losing startups in the U.S. They raised a total of $93.8 billion in startup funding and lost $135.1 billion.

Only one of those 15 companies has ever had a profitable quarter — Airbnb made a profit of $378 million on revenue of $2.1 billion in the second quarter of 2022. All other startups in the table have recent losses of more than 10% of revenue. More than 30%

Any promising arguments that profitability is around the corner when every company is at least nine years old and two are more than 20 years old. At some point, investors say “enough is enough” and realize that throwing good money after bad is a false ruin.

Startups with $3 billion or more in cumulative losses



Collected money

Cumulative losses

Uber Technologies UBER


25.2 billion dollars

31.7 billion dollars



21.9 billion dollars

20.7 billion dollars

Teladoc Health TDOC


0.17 billion dollars

11.2 billion dollars

Rivian Automotive RIVN


10.7 billion dollars

11.1 billion dollars

Snap Snap


4.9 billion dollars

9.1 billion dollars



4.9 billion dollars

8.9 billion dollars



6.0 billion dollars

6.0 billion dollars

Palantir Technologies PLTR

In 2003

3.0 billion dollars

5.8 billion dollars

Gingko Bioworks DNA


0.8 billion dollars

4.8 billion dollars



2.5 billion dollars

4.6 billion dollars

NVTA Invite


2.0 billion dollars

4.4 billion dollars

Nutanix NTNX


1.1 billion dollars

4.3 billion dollars

RobinHood Markets HOOD


6.2 billion dollars

4.2 billion dollars

Bloom Energy BE


0.83 billion dollars

3.3 billion dollars

Wayfire w


1.7 billion dollars

3.0 billion dollars


93.8 billion dollars

135.1 billion dollars

Of the 15 companies in the table, 11 have raised more money than any bankruptcy startup has ever raised. The two biggest losers so far are Uber and WeWork. So far, Uber has a combined loss of $31.7 billion and WeWork $20.7 billion, with no end in sight. Uber’s stock price is down 35% from its 52-week high. WeWork is down 71% and is now officially a penny stock.

Losses must be financed and it is very difficult for these companies to do so. Many of these so-called unicorn startups have seen their stock prices fall by more than 50% in the past year, and many of these stocks have fallen by more than 90%. WeWork isn’t the only unicorn turning into a coin stock.

These declines in stock prices make it difficult and expensive to issue additional stock to raise funds to cover ongoing losses. Meanwhile, rising interest rates increase the cost of servicing existing debt and make it harder and more expensive to issue more debt.

Many unicorns will soon go bankrupt or be bought at fire sale prices. The failure of Uber or WeWork is 10 times larger than past lost venture-capital funding. A wave of unicorn failures will send tremors through financial markets, but the federal government is unlikely to use the “too-big-to-fail” excuse to intervene.

Although the startups in the table are American companies, unicorn startups in other countries have similar problems: European Startups (Delivery Hero XE:DHER),
Deliveroo UK:ROO,
and Sage UK: Sage
); The Chinese (DD DDI,
Kuaishou HK: 1024,
Billy Billy and Pinduo Duo PDD
); Indians (Ola, Paytm and Zomato IN:543320
) and Singaporeans (Grab and SEA) also have multi-billion dollar cumulative losses.

New records among unicorn companies will soon be set around the world – but they won’t be as good as records for filling candles, spinning basketballs and scratching.

Jeffrey Lee Funk is an independent technology consultant and former university professor who focuses on the economics of new technologies. Gary Smith is the Fletcher Jones Professor of Economics at Pomona College. He is the author of “Money Machine: The Surprising Power of Value Investing” (AMACOM 2017), author of “AI Delusion” (Oxford, 2018) and co-author (with Jay Cordes) of The 9 Traps. Data Science” (Oxford 2019).

More: A squeeze on corporate profits is now the biggest threat to the stock market.

in addition Savvy investors invest their money in a company’s true profits — not Wall Street’s false prophets.

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