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June 05, 2011



It sure seems like we're in somewhat of a bubble, although I'm no expert. What amazes me is the size of investments going into early stage tech companies producing little or no revenue yet. I can understand a few million into a company that could make money someday or perhaps be acquired by the big dogs, but the sheer number of early stage startup investments in the 20-100 million range in the past year is what kills me. My startup needs less than a million to scale up to a size where we should be able to prove our revenue potential and profitability. If my company doesn't line up the funding before the bubble bursts, I feel like we're going to have a tough time fighting through the calamity.


Watch for the phrase "new paradigm" attached to discussions about valuation. Also "old economy" vs. "new economy". In short, if traditional valuation metrics can't be used, we are in a bubble.

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