Tuesday, 26 January 2016

Rabbits join Unicorns in the Investment Menagerie

Regular readers of this weblog will know that over the past six months we have had a good deal to say about Unicorns. But it seems that there are other animals in the investment menagerie.  Writing in Australia's Business Insider ("2016 will be the year of the rabbits", here), Sam Shead picks up on a theme brought to light by CB Insights CEO Anand Sanwal in his daily newsletter: the rise of the Rabbit.  In short, while 2015 was the year in which the cash-rich Unicorn start-up was revealed to the investment community in all its billion-dollar splendour, we can expect to see something quite different this year, with the rise of the Rabbit.  

What is a Rabbit? The letters are an acronym of its key features:
  • Real
  • Actual
  • Business
  • Building
  • Interesting
  • Tech
While the acronym is rather contrived ('real' and 'actual' are synonyms, 'business' is a generic descriptor and it's not easy to find any business that is not, to at least some extent, 'interesting'), the idea is worth bearing in mind.  As Sanwal explains, 2016 will not be the year of the Unicorpses (dead unicorns) -- but it will be the year in which we may be separating the rabbits from some Unicorpses. Shead quotes Sanwal's words:
“With 152 (Unicorns), there will of course be some flame-outs or those that run into issues. These are not riskless bets after all. ... While it’s ‘fun’ in a schadenfreud’y way to claim some absurd number of Unicorns will falter in 2016, it misses out on the fact that 2016’s climate may force many of these Unicorns to become Rabbits.”
The precise mechanism by which Unicorns metamorphose into Rabbits is not spelled out. Some may simply shrink as investor commitment decreases in order to fall in line with a company's intellectual assets and competitiveness rather than hugging the contours of its cash assets or focusing on a market potential that is easier to identify than to fulfil. 

There are however two certainties.  The first is that the role played by patent analytics in guiding both businesses and their investors will increase rather than diminish, as competitors' patents provide a set of hedges and hurdles which Unicorns must navigate if they have insufficient IP to protect their own growth or cross-license to others.  

The second is that, now that Unicorns have been joined by Rabbits, there will be a rash of acronyms as pundits and commentators seek to make a name for themselves. How long will it be before we see the rise of the Badger, the Mongoose and the Wombat?  Readers are invited to submit their own suggestions ...

13 comments:

  1. How about replacing the troll with the HARE: Highly Assertive Rogue Enterprise!

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  2. Make way for the PARROT, this clearly being a company that is the Proprietor of All Relevant Rights Over its Technology. Invest in a Parrot if you want to feather your nest :-)

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  3. Needn't Spell It Out27 January 2016 at 11:18

    I know it's not an animal, but the word at least refers to a by-product of the animal (and human) kingdoms - has anyone noticed that some of the Unicorns that aren't heavily backed by an intellectual property portfolio are Cash Rich, Asset Poor.

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  4. Thank you for your great acronym suggestions -- and keep 'em coming!

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  5. Hyena - High Yielding Enterprise, North American

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  6. TAPIR looks like a shoe-in, but can't quite get it right. Maybe Technology And Patent Innovation-Rich?

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  7. I prefer POODLE: Particularly Overcapitalised Operation Displaying Little Energy

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  8. Is there a prize for this?

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  9. Three cheers for the Potto (https://en.wikipedia.org/wiki/Potto), the Patent Owner Taking Tax Opportunities

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  10. @Anonymous 27 Jan 10:55

    HARE sounds a bit wimpish as a replacement for a troll. You'd be much more afraid of a GORILLA - Greed Oriented Licensing and Litigation Aggressor!

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  11. For the avoidance of doubt, and just in case expectations have been raised, we confirm that there are no prizes for submitting witty acronyms, other than the satisfaction earned by having contributed to an enjoyable stream of comments!

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  12. IBIS = Insolvent But Innovation-Sound.
    COATI = Comfortably Off And Technologically Intrepid
    Still stuck for RHINOCEROS :-)

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  13. The Patent Gorilla is a different type of gorilla. They are more like a VIPERS (Vicious Intellectual Property Eviscerating Robbing Shysters) which are full of POISON (Patents Of Imperceptible Sufficiency Or Novelty) they prey on GOPHERS (Great Original Patents Having Extensive Real Sufficiency). These small industrious creatures are hunted down by the VIPERS. The VIPERS are so full of POSION that it usually takes one bite to kill the GOPHERS, which are then eaten by the VIPERS to make more POISON. GOPHERS were an endangered species until the APES arrived (Against, Practicing Entity Shysters). The APES like and help GOPHERS and hate the VIPERS. Be more APE.

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