Is Silicon Valley’s golden era coming to an end?

theguardian.com:

Huge layoffs at Snapchat, dramatic valuation drops at Meta and Apple, and hiring freezes at other Big Tech firms have given new fuel to an increasingly common question: Is Silicon Valley’s golden era coming to an end?

The answer is complicated, experts say. The tech industry has been on a run of impressive growth for some time, bolstered in recent years by a pandemic that forced most of the world online and sent demand for tech services booming. That explosion – and the high salaries and office perks that came with it – seems to be slowing.

“This party couldn’t go on for ever,” said Margaret O’Mara, professor at the University of Washington and author of The Code: Silicon Valley and the Remaking of America. “In many ways, we are just going back to normal after a huge run up during which everything became supersized.”

Those trends are exacerbated by a larger global downturn – one the tech world is not immune to, she added. The Federal Reserve has raised interest rates three times already in 2022, and more increases are expected.

The previous low-interest-rate environment had bolstered the tech boom, helping to create a parade of “unicorns” – companies whose valuations exceed $1bn. Notable examples include Airbnb and Uber – valued at $47bn and $82bn at their respective public offerings. But as interest rates shift, O’Mara said, there is “less money sloshing around” and investors are going to be deploying cash “in a much more judicious fashion”.

“Certain investors will still have cash, but during a bust like this the deal flow is going to be cooling,” she said.

Fast growth has also been tempered by a series of high-profile cautionary tales, from the decline of WeWork to the collapse of Theranos, the blood testing firm that rose