“Made in Vietnam” is a lie!

10 Jan 2026 · 1 min

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Dan Novaes argues that current high valuations for tech startups are a mirage driven by venture capital-funded ‘growth at all costs’ and ultra-low interest rates. He claims the model only worked while the cost of capital was near zero and that rising interest rates remove the incentive to value growth over profitability, triggering valuation collapses, mass layoffs, and bankruptcies.

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Stop celebrating the high valuations of tech startups. When a startup takes billions in venture capital money, they are prioritizing a massive burn rate over profitability. This entire system, the venture capital mirage, is reliant on interest rates staying near zero. This financial delusion is the unicorn status, a billion dollar valuation based on potential monopoly and growth at all costs, not current revenue. The chart of unprofitable unicorns has been soaring for a decade. The model worked only when the cost of capital was essentially free, but I'll show you why the cost of that capital has suddenly expl. When interest rates rise, the market stops rewarding growth without profit and the money taps turn off the valuation, the mirage evaporates. This instantly causes mass layoffs, major valuation cuts, and bankruptcies among companies that were supposed to be the future. It's the burn rate death spiral. Coming to collect for more information like this, follow UBK.