Derek Lidow: It’s Worth What!? Pressure-testing Companies with Sky-high Valuations

Excerpt from the Knowledge@Wharton article, "It’s Worth What!? Pressure-testing Companies with Sky-high Valuations," by Derek Lidow

Are the sky-high valuations that have put companies like Uber and Airbnb constantly in the headlines proof of their staying power? Not necessarily, says Derek Lidow (Twitter: @DerekLidow), author of Startup Leadership: How Savvy Entrepreneurs Turn Their Ideas into Successful Enterprises, who teaches entrepreneurship, innovation and creativity at Princeton.

In this opinion piece, Lidow, who was the founder and former CEO of iSuppli Corporation, offers a four-part test for how companies can evolve from “top draft picks” to “wily veterans.”

Uber recently set a record when it was valued at $17 billion. The transportation start-up both disrupts and leverages the incumbent infrastructure of taxis and town cars. Airbnb, the home room rental start-up, was recently valued at $10 billion, giving it a greater worth than most of its larger traditional hotel rivals. Sky-high valuations have become commonplace. The question is: Are these companies really worth it? Keep reading >>