Tech valuations versus tech-enabled valuations: 2020 IPO edition

The value of tech-enabled companies is coming into focus as several American unicorns test the public markets. The data show that some venture-backed companies often grouped with technology companies are worth just a fraction of their tech-first cousins.

By tech-enabled business, we mean a company that has a technology element to its operations but doesn’t generate the sort of high-margin or recurring revenue that tech companies are famous for today, especially in the software market.

The impact of this increasingly clear divergence in how companies are valued will continue to shake out over the next few years as some of the hundreds of private unicorns attempt to go public. Today, with new information from Casper and its fellow unicorn One Medical — not to mention some historical data from flops like Blue Apron, WeWork and others — we can begin to piece together an understanding of what counts as tech, what doesn’t and the value delta between them.

Two companies, two prices

Picking fresh ground as our starting point, One Medical is hoping to best its private valuation in its IPO, while Casper is not.