Much breath has been expended in recent months over speculation as to whether we're in the midst of a re-run of web 2000. Goldman Sachs' valuation of Facebook at $50bn, Groupon at $25bn, LinkedIn at $8.5bn and Microsoft's recent purchase of Skype for $8.5bn have done much to fuel this conjecture. But are we really witnessing the inflation of another dot com bubble, or are we finally appreciating the value of digital potential?
As one who lived, loved and lost in the dot com boom I can say that the current situation certainly feels different. Back in the day high profile site launches were an everyday occurrence, venture capitalists courted dot com entrepreneurs like they were new season debs and our only headaches were due to excesses of lunchtime champagne and working out which was the coolest venue for our site refresh party. Toward the end of the year we sensed a chilly change; B2C was old-hat, B2B was the belle of the ball and before we knew it high profile sites were tumbling in value – lastminute.com – or disappearing completely – clickmango, boo and flooz.com. And the rest as they say is history…
But aside from the lack of obvious excess and excessive eagerness for easy earnings, this time seems different as we're in a different world. Digital natives are increasingly dominating demographics and even those of us born pre-1975 are finding the web a happy place to inhabit. Add to that the wealth of insight, tools and the web's sheer ubiquity and it starts to look like these recent valuations might actually have something to them. Of course, the digital world is a capricious place and even the likes of Google and Microsoft have had to fight to stay on top, but stay on top they have and with revenues that justify their stock prices.
So there's nothing to worry about and all the flowers in the digital garden are coming up roses, right? Well…no. Folly and finance still go hand in hand despite recent events, and money for apparently nothing ($41m for the Color app) continues to haunt the dot com sector. The proof of the pudding will be in the eating, but for someone who's been there, done that and has still got most of the t-shirts this feels to me like the wind of change.