Need we fear a tech bubble?

THE first quarter of 2016 turned out to be disastrous for high-profile unicorns, or startup companies valued at over US$1 billion.

According to a quarterly global report on venture capital (VC) trends published last year by KPMG International, only five venture-backed companies in the US managed to join the exclusive billion-dollar club. Most companies faced layoffs, down rounds, and mutual fund markdown valuations.

Even the biggest was not spared. LinkedIn's share price plummeted 40 per cent after its earnings call in February, wiping out nearly US$11 billion of market value. Fund manager T Rowe Price marked down its Dropbox valuation by 51 per cent, reflecting declining investors' confidence in cloud file-sharing solutions.