It's more bubbly than it was 2 years ago, but still nothing like the Bubble in the late 90s. The defining quality of an investment bubble is people (a) investing a lot of money in stupid things, in the hope that (b) other people will pay more for them later. Neither are happening now. Though a lot of startups are getting started, the amount being invested is small, because startups are taking way less each. And (b) isn't happening because the IPO market is still very small. Acquisition is still the main exit, and acquirers are more prudent than retail investors.
As recruiting good quality talent becomes harder and it becomes cheaper and easier to build a web application, the only competitive advantage left to entrepreneurs who are genuinely going to create value is savvy product sense and the ability to actually exploit a business opportunity. <p>I don't believe we're in a bubble (in the sense of a liquidity event) - but certainly the number of people who have never before considered starting a web business who are wanting to give it a go are coming back again.
No. A bubble happens when you have a huge number of trades at prices well above the fundamental value of items being traded. In this case I assume the items we're referring to are "small, internet-oriented companies". At least right now there is not a high enough volume of trades happening to drive prices up into the astronomical range characteristic of a bubble.
This feels a lot different. The barrier to entry has dropped a lot, so we're seeing lots of small start-ups as opposed to the gigantic ones last time around. Also the monetizing seems to be coming from larger tech companies (Google, Yahoo, etc.) as opposed to non-technical outside investors.
Definitely.
Unlike what pg thinks, it seems to me that there are a lot of stupid ideas out there that get funded, and that most of them are merely features rather than full blown products, that simply wait for someone to buy them.
I think we're going to see far more companies fail than succeed in this current boom, but the crazy optimism of the first bubble seems gone. The bets are smaller and more numerous, so some are bound to take off.