Time for another bubble?


This past weekend, someone mentioned how happy he was because the Silicon Valley is back. I couldn’t agree more, except I am worried about the accompanying over exuberance. Like Silicon Valley, back are frothy forecasts and risky investments. More than $15 million in three download MP3 file start-ups – what do you call that? We already have seen a Broadcast.com type deal – eBay-Skype you know! Henry Blodgett is back to being a reporter, and any day you can expect him to get a job offer from some VC fund. George Gilder came out of hiding at the Always On Conference. And now the news the Queen of the Net, Mary Meeker, is starting coverage of China Internet Stocks, in addition to her regular pounding the table of stocks like Google. This is as good a time for another bubble…. not that there is anything wrong with it.



Well, I live in Berkeley and we just spotted the first “Price Reduced” realtor’s sign in five years, in our neighborhood.

I think the bubble is quivering.

Raghav Gupta

I also go by the ‘locker room’ test. Back in the late ’90’s you’d frequently overhear conversations in the locker room about stocks, options, IPOs, etc.

These days it’s about real estate!

David McClure

Party exuberance aside, I don’t know if it’s a ‘bubble’ unless the investor expectations are unrealistic… however there’s no question there is increased entrepreneurial & venture activity & optimism.

However, one could argue that with Google, Yahoo, Microsoft, EBay, AOL, IAC, Amazon, and others as motivated acquirers all flush with cash, then the likelihood of competitive and valuable exits could very well merit all the investor optimism.

Given that all of those companies are growing (some faster, some slower), all cashflow positive (some moreso, some less so), and all making big bets on search and the Internet, it’s not so much a bubble as a massive Web 2.0 landgrab.

1998-2000 was all about overloaded investor expectations, driven by retail investor fervor and analyst hype creating weightless IPOs doomed to gravity.

2001-2004 was the negative backlash effect of those IPOs returning to earth.

2005-beyond is about all the good ideas from the late 90’s, with more mature entrepreneurs, more modest budgets, and more reasonable exits — determined by the management teams of the successful Internet 1.0 giants, not the retail investor.

– dave mcclure
exuberant entrpreneur @


Companies acquiring other companies are more to blame in this bubble. Investors might not be buying as much percentage of tech stocks are they were last time as VC’s funding new companies, old tech companies buying out smaller new ones etc.

Who are people going to blame for getting fooled twice(or not learning from history if this is their first time)?


add another to the list:

when you goto a party and all they talk about are stock options. Ahhh…the parties in SF during 1999-2000.

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