Let’s Party Like it’s 1998

I’ve seen several articles recently comparing the current times in Silicon Valley to the heady days of the Great Bubble, using a cliche reference to the Prince song that equates partying and 1999. Is it an apt comparison? Are we in the midst of “Bubble 2.0”?

Well, the good times have certainly returned to Silicon Valley, and once again, San Francisco has turned into a hotbed of startups and startup-related parties. But I remember the sequence of events that created the Web 1.0 bubble all-too-well, and do not believe we are in the 1999 phase. I’d say it’s more like 1998.

Why? Although we’re seeing a lot of merger and acquisition activity, so far we have not seen a collapse of sanity guarding the IPO window. We are just in that giddy phase where a lot venture capital is sloshing around, and an increasing number of entrepreneurs are able to flip their startups into acquisitions by Google, Yahoo, Amazon, eBay, and the media companies. And just maybe the lessons learned the hard way in 2000 and 2001 are fresh enough in our memories to prevent a complete replay of the Apocalypse over the next two years.

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