Illustration by Chris Gash

It's tricky.

By Erin Griffith
August 3, 2016

Just about everyone working in tech has their own answer to the question, “How do you know we’re in a tech bubble?” Perhaps it’s the proliferation of startups buying up ads on billboards, subways and taxis. Maybe it’s the existence of congratulations cards for raising a round of funding, or maybe it’s the booming ping-pong table market. It could be when bankers quit their high-paying Wall Street jobs to work at startups. Maybe it was the time a startup literally gave away free cash, or the time a unicorn graced the cover of Fortune. For Fortune’s Adam Lashinsky, it was when a CEO tried to sell him pre-IPO shares.

For me, it was seeing Goldman Sachs analysts describe themselves as “angel investors” on Tinder. Wall Street dominates New York’s economy, but people working in finance know it sounds a lot cooler to say you work with startups, even if your definition of working with startups means having an AngelList profile.

So let’s say, hypothetically, you’ve come to the same conclusion – we’re in a tech bubble — and you’re in the position to put your money where your mouth is. Can you actually short the tech bubble? The short (ha) answer is “no” because the companies and their investors are privately held. But that hasn’t stopped some investors from coming up with creative methods.

I asked the Twitter hive mind, as well as a few hedge fund investors. Here’s what they said.

Short publicly traded investment firms and funds with exposure to startups.

That includes Rocket Internet and GSV Capital GSVC .

Likewise, large companies like Facebook FB or Amazon AMZN have exposure to startups. Facebook lots of pricey app install ads to startups, and Amazon sells lots of cloud storage through Amazon Web Services. I don’t think the exposure of either company’s business is large enough that a startup meltdown would truly hurt either company’s overall business, but plenty of other investors have made that case.

Go long the companies supposedly being disrupted.

You could buy shares in the incumbents. In other words, assume that if Airbnb fails to disrupt Marriott MAR and Starwood HOT , their stock will go up. Think Uber will fail? Invest in Medallion Financial MFIN , the leading taxi medallion lender.

This is probably the worst and most indirect way to bet against startups. Airbnb and the hotel industry could both fail independent of each other. Making matters worse, if you subscribe to the notion that “software is eating the world,” that means startups will disrupt everything from transportation and hotels to agriculture and healthcare. Using this method to bet against the startup market would mean going long in literally everything but, I dunno, business consultants. (Wait nevermind, there’s an Uber for business consultants called HourlyNerd.)

Short Silicon Valley Bank

It’s not well-known or well-understood by the public, but most startups with a little revenue take on a pile of debt alongside or after their equity fundraises. Silicon Valley Bank SIVB , Comerica CMA , and Square 1 SQBK , are the most well-known players in that market. (As of the first quarter, around half of SVB’s 17.8 billion in loans were in the tech, life science and healthcare industry.) All three firms are publicly traded, though Square 1 stock isn’t very liquid, as it is 90% owned by PacWest Bankcorp.

Invest with the only firm I could find that’s shorting the startup market.

That firm is Snow Ventures. Read my profile of the firm here.

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