I keep hearing that we are in the midst of another tech bubble. The question is simply, is the current level of activity sustainable? I firmly believe that we are in a bubble, however I do think that the rate of current startups will decline. Most of the early stage companies I work with are bootstrapped and don’t need millions of dollars to execute upon their ideas. Companies that do need VC level of funding will have a harder time getting access to $2 to 5 or even 10 million.
Check out this hilarious take on the bubble. Maybe a little close to the truth for comfort.
[youtube=http://www.youtube.com/watch?v=fi4fzvQ6I-o&rel=1]
Tags: aquantive, Facebook, hiring, tech bubble
December 10th, 2007 at 7:07 pm
Nathan, what makes you think we’re in a bubble? In other words, how do you define bubble?
There’s no question we’re seeing a tremendous amount of new startup activity, but I define bubble not on that basis but rather on the basis of number of financings and ridiculous valuations. I don’t think the pace of investment has increased dramatically over the past two years nor have the valuations. That said, there are a couple CRAZY valuations out there these days, not the least of which is Facebook.
We’re merely seeing a lot of new entrepreneurs emerge from the safe havens and stability of corporate jobs with a concept, and give it a go. But to the extent “bubble” terminology reminds us that it could ALL come tumbling down, it’s a good thing.