Startup with Russian roots Evernote called the "dying unicorn"
Bill Garley , a well-known American venture investor and member of the boards of directors of Uber and eBay, expects the death of several “unicorns” (companies with estimates of more than $ 1 billion) already in 2015. He explains his hypothesis by an excessive love of risk and large investments in Silicon Valley.
The head of the blog platform Syrah Josh Dixon believes that the first will be a project for working with notes Evernote . The closure of the three offices and the dismissal of 47 people, which the company announced this week, should be considered a wake-up call.
Edition Slon leads the reasoning and predictions of experts about the future of Evernote.
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The founders of the project are Phil Libin and Stepan Pachikov - people from Russia who moved to the United States. Evernote launched its first commercial product on the market in 2008. In 2012, Evernote was valued at more than $ 1 billion, the valuation during the last round - the company raised $ 20 million from the Japanese Nikkei - remained unknown. For all its existence, Evernote has raised about $ 300 million.
The main product of Evernote - a service for working with notes and file synchronization - has not changed much over the years of the company's life.
“Evernote has a great core product, says business angel Pavel Cherkashin. “But the fact that Evernote has a solid base, formed back in 2012, does not mean that the company has no problems.” The market in which Evernote was once a pioneer, gradually began to occupy other companies specializing in individual functions.
“Cloud storage products, like Dropbox, captured one part of Evernote’s potential audience, project management systems (like Asana or Podia) - the second, and the third went to instant messengers,” says Artyom Inyutin, a partner of the venture fund TMT Investments. He notes that the company released the mobile application too late, and the new services were not the most successful.
But this cannot go on forever.
“The venture market is not buying current financial indicators of a business, but growth expectations. A company with an income of $ 20 million, a loss of $ 40 million, but an x80 multiplier (because investors believe in its future) will cost $ 1.6 billion and will be considered a unicorn (a good example is Slack), and a company with income of $ 200 million and a steady profit of $ 20 million may have a multiplier of x1.5 and, accordingly, a capitalization of $ 300 million - because investors do not believe in future growth and return their investments through dividends. Another year of such a life for Evernote - and the company will face Nokia’s fate at best, ”Cherkashin argues.
The head of the blog platform Syrah Josh Dixon believes that the first will be a project for working with notes Evernote . The closure of the three offices and the dismissal of 47 people, which the company announced this week, should be considered a wake-up call.
Edition Slon leads the reasoning and predictions of experts about the future of Evernote.
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How it all began?
The founders of the project are Phil Libin and Stepan Pachikov - people from Russia who moved to the United States. Evernote launched its first commercial product on the market in 2008. In 2012, Evernote was valued at more than $ 1 billion, the valuation during the last round - the company raised $ 20 million from the Japanese Nikkei - remained unknown. For all its existence, Evernote has raised about $ 300 million.
Evernote allows you to create notes, synchronize files between devices, collaborate on documents. This summer, Evernote reported that it has 150 million registered users (mostly in the US). In Russia and the CIS, according to director of business development in this region, Rodion Nasakin, more than 6 million users.
In May 2012, Evernote had 25 million users, in May 2014 - 100 million. This shows the growth rate of the company.
Evernote earns from the sale of paid accounts with additional options (from $ 24.99 to $ 49.99 per month) and corporate accounts ($ 12 per month from one employee). According to Nasakin, with the change in the pricing policy of Evernote in April 2014, the company's revenue increased by 60%. The company does not disclose revenue figures, but market participants estimate it at $ 120–200 million per year.
Problems or mistakes?
The main product of Evernote - a service for working with notes and file synchronization - has not changed much over the years of the company's life.
“Evernote has a great core product, says business angel Pavel Cherkashin. “But the fact that Evernote has a solid base, formed back in 2012, does not mean that the company has no problems.” The market in which Evernote was once a pioneer, gradually began to occupy other companies specializing in individual functions.
“Cloud storage products, like Dropbox, captured one part of Evernote’s potential audience, project management systems (like Asana or Podia) - the second, and the third went to instant messengers,” says Artyom Inyutin, a partner of the venture fund TMT Investments. He notes that the company released the mobile application too late, and the new services were not the most successful.
Entering the stock exchange provides additional capital and opens up new opportunities for companies. But the founders of startups and early investors sometimes postpone an IPO, as they are afraid that they will not be able to meet the high demands of the market. Just to confirm its estimate of $ 10 billion, the company must increase its revenue by the end of 2015 by 226%, to $ 1.4 billion. And Evernote has already missed the best time for an IPO, according to investors interviewed by Slon.
To be or not to be?
The new CEO of Evernote, who came from Google Chris O'Neill, who came in July 2015, does not communicate with journalists, and in many ways, therefore, the company was at the center of suspicion. Evernote needs a new round of audience growth and new, revolutionary products, and it is they who are expected from O'Neill.
Who is next?
Evernote is not the only company whose pace of development is not keeping pace with investments. Such companies have access to huge capital, and after unsuccessful decisions, they do not leave the market, but pour in all the new money to correct errors.
But this cannot go on forever.
“The venture market is not buying current financial indicators of a business, but growth expectations. A company with an income of $ 20 million, a loss of $ 40 million, but an x80 multiplier (because investors believe in its future) will cost $ 1.6 billion and will be considered a unicorn (a good example is Slack), and a company with income of $ 200 million and a steady profit of $ 20 million may have a multiplier of x1.5 and, accordingly, a capitalization of $ 300 million - because investors do not believe in future growth and return their investments through dividends. Another year of such a life for Evernote - and the company will face Nokia’s fate at best, ”Cherkashin argues.
Source: https://habr.com/ru/post/295004/
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