Until recently, start-ups of all shapes and sizes were achieving ridiculously high valuations based on little more than an exciting idea and a young, motivated promoter. Money was practically free, investors had little else to punt on, and there was enough appetite in the market to swallow all sorts of ideas. The turn of the interest rate cycle last year changed all that and, for now, caution has replaced exuberance. There are important lessons to be learnt from this experience so as to not repeat the same mistakes when the cycle turns up again.
The attached paper offers Adit Jain's perspective.