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If you hold stock in any tech company, even a smaller one, you're likely to be in a bad mood this Monday. Apple, the most valuable tech brand in the world, saw its stock price down 10 percent when the market opened, while Facebook was down 12.1 percent, Amazon was down 6.4 percent and Microsoft down 5.8 percent. Twitter meanwhile, hit a new low by falling 18.7 percent to around $21 at one point, below its IPO price.
The market had plenty of bad news for everyone on Monday morning of course. Hundreds of billions of dollars were lost over the weekend as the markets suffered in reaction an enormous sell-off on the Chinese market following heightened concern when the Chinese government devalued its currency. But tech companies large and small were far from immune to the situation.
And yet despite the "Black Monday" name to the sell off, many stocks are already rebounding to a certain extent. Apple, for one, was actually back in positive territory early Monday afternoon. Apple, which fell below $100 a share for the first time in a year, has strong connections to China, since that's where Apple's phones are made, but Tim Cook emailed CNBC's Jim Cramer to assure him that phones were still selling just fine, meaning investors shouldn't be panicking just yet.
But tech companies that haven't gone public are probably re-counting their cash just in case the market troubles lead to a narrower funding spigot for them. A few, like Uber and Airbnb, have put aside billions of dollars for future growth already, which should be plenty for them to weather whatever financial storm the Chinese market issues cause. But smaller companies counting on a successful IPO, or funding based on the promise of one, are likely feeling a bit more nervous. And at least one company, biotech firm RainDance Technologies of Massachusetts, withdrew its IPO plans Monday due to the market conditions. There might be a flurry of acqui-hires and other mergers as consolidation can mean a more stable return on investment, but even that isn't certain since lower prices might mean venture capitalists are reluctant to see a lower return on their investment in that case.
The current kerfuffle may not be the end of the tech boom quite yet, but how companies and investors react to it might be a good predictor of what will happen if and when there really is an implosion on the market. How a bear market will affect startups that haven't gone public yet is a lot harder to predict, but anxious phone calls between founders and investors are probably the first business of the day this week.
