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Rocket Internet: The Start-up Factory
INTRODUCTION
In September 2016, Rocket Internet (Rocket), a public listed Berlin-based internet company, reported that its half-yearly losses from January to June 2016 amounted to a whopping $688 million as compared to $51 million in the same period the previous year. Such a drastic loss was owing to write-downs of many of Rocket’s leading portfolio companies across the world. In July 2016, Kinnevik, Rocket’s second largest investor, wrote down $2 billion of Rocket’s flagship company, Global Fashion Group (GFG) , making its new worth just $1 billion. Such a drastic write-down made investors and analysts question valuation of Rockets other companies, which was based on fundraising from third-party investors and was termed as LPV (last portfolio value).... |
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