I’ve been looking for signs of Bubble 2.0. Until now, I’ve just seen rising mood, more parties, and more traffic on the highways, but nothing that constitutes the return of the madness that gripped Silicon Valley (and the world) in the late ’90’s. Until now…
Here are the definitive signs:
1) Tech IPOs are in the news, including VMware, which had, according to the front page of the San Jose Mercury News, “an opening-day surge that exceeded even Google’s historic 2004 launch.” Bubble hallmark: focus on the instant riches made possible by trading on the very first day a stock is public.
2) Mainstream media treating entrepreneurs as the new rock stars. This week’s edition of Newsweek features 23-year-old Mark Zuckerberg on the cover. There’s nothing better for inflating a Bubble than the thought that someone fresh out of college can turn an idea into an IPO and become a billionaire. It sells magazines, and it sells stock, and it attracts more people to the game who are looking to get get rich, quick.
3) Office spaces becomes scarce, but the landlords start accepting equity instead of cash. I had hoped we would not see this scary sign for at least another 12 months, but according to today’s Wall Street Journal, it is already happening again:
“Amid the revival, some tech companies have started using an old dot-com property tactic: paying their office landlords with stock options. Internet startup Riya Inc., for example, says it’s paying its landlord partly in stock for a 5,000-square-foot commercial space in San Mateo, Calif.”
Sounds like it’s time for me to sit down and write the “How to Know Your in an Internet Bubble” guide that I’ve been meaning to write. Wasn’t sure there’d be a need for it this soon.
The Real McCrea 