Many Unicorns—start-ups with valuations of $1 billion or more—may not really be worth as much as they appear before they go public, angel investor Esther Dyson told CNBC on Wednesday.
But a $50 billion valuation for ride-sharing service Uber makes sense, the chair of EDventure Holdings told "Squawk Box " from the Delivering Alpha conference presented by CNBC and Institutional Investor.
"What Uber is doing is extremely sustainable. They're taking real resources and they're allocating them much more efficiently," she said. "The fundamental Uber business model is actually brilliant."
One of the challenges going forward for Uber will be its cost structure, Dyson said. "It's going to be harder to just go out and hire people randomly."
"Uber [service] is incredibly cheap partly because they're not paying all the externalities" such as insurance costs and upkeep on the cars, she said. "The drivers may not unionize, but they're going to get a little less enthusiastic."
Uber aside, the real problem for start-ups considering going public is there are just too many of them, Dyson said: "It's completely random. Some get amazing valuations. Some can't raise money. There are too many founders and CEOs and not enough actual workers."