Selecting the outliers as exemplars of what is typical doesn't make much sense. What about the 100,000+ non-Googles and non-Facebooks that very much fit into what the author is stating here? Poor businesses funded by poor investors supported by a poor media is the problem here and all that the "Series A Crunch" will do is "expose those who were swimming naked" as so eloquently stated by Warren Buffet [1].
Companies with good business models or great technology or great ability to persevere or the ability to iterate will always survive. The point of this article is that the clock has already run out for the ones that don't.
The entirety of the startup "industry" is about exemplars and outliers. If we went by the typical outcome of a startup (or any new business, tech or otherwise) we'd never start anything.
Everyone is in it to try and become an outlier.
The theory is that we would be willing to invest in 1000 non-Googles and non-Facebooks if it means we can have a shot at having a single Google or Facebook. The "crunch", as it were, seems to be arising from the fact that there seem to be a lot more than 1000 non-Googles for every Google, and even the successful don't seem to be as successful as tech companies in previous generations - which leads to an adjustment in the ratio of failures/successes that you're willing to accept.
That in and of itself is unsurprising, but the natural concern is whether or not we've figured out, even roughly, what predicts success, and if the "crunch" correctly targets clearly bullshit companies, or if it's a general contraction that will eliminate good companies as well as bad.
I don't think anyone is lamenting the loss of bullshit businesses with no plan. The more concerning question is: are we any better at determining future success, on day 1, than we used to be?
Companies with good business models or great technology or great ability to persevere or the ability to iterate will always survive. The point of this article is that the clock has already run out for the ones that don't.
[1] http://www.brainyquote.com/quotes/quotes/w/warrenbuff383933....