Benchmark Capital investor Bill Gurley once again sounded the alarm about what he sees as the potential doom looming in the tech industry’s future at South by Southwest Interactive in Austin, Texas today.
Gurley, who hasn’t been shy about saying that the tech market is in a bubble, told an audience at SXSW that the industry’s dependance on free-flowing capital means that it’s playing a risky game in the event money dries up, according to a report by Fortune. He cited Facebook’s popular app install ads as one example. Those ads are hugely popular in part because of a glut of venture-backed startups that have big advertising budgets to drive user growth.
“As you get more of these dependancies, it increases the likelihood that if anything slows we’ll have [problems],” he said.
A crash isn’t in some far-off future, either. Gurley said that he expects to “see some dead unicorns this year,” referring to companies valued at more than $1 billion. He said that entrepreneurs who want to prepare for a coming crash should be sure to have a back-up plan to quickly get their company to profitability.
Of course, Gurley isn’t the only investor sounding the alarm. Angel investor Chris Sacca told an audience at the Launch Festival earlier this month that he “can’t wait” for the next tech crash, while Mark Cuban has raised his own set of concerns about a lack of liquidity in venture investments.
