What We can Learn from the Dot Com Bubble

Big Data, Cloud Services, E-commerce- the list of tech buzzwords is limitless, and present in every investor’s vocabulary.

Technology is driving much of our country’s innovations, so the investor frenzy around tech is reaching levels reminiscent of the Dot-com era. However, such frenzy should not be as concerning, as investors have learned a few key lessons from the last tech bubble.

Investing in Ideas

During the dot-com bubble, the internet and everything it launched was so new, that investors threw their money at ideas, rather than concrete plans. This strategy was bound to fail, as even the best ideas can be crippled by a dysfunctional team or un-scalable business plan. Now, casual investors to venture capitalists are careful to ensure that new companies with promising ideas also have a strong strategic background.

Continuous Tech Buzz

The accessibility of the internet has made it so anyone can create a startup around it. It has also turned into a widely used productivity tool, present in schools and businesses alike. Because it is already used by almost everyone, consumers are hungry for more and more innovation, and in different fields of tech. Better storage, stronger data security measures, are a few examples of spaces that are ripe and in high demand for innovation.

The “World Wide Web” has lost some of the initial luster and exclusivity it flaunted upon introduction. But that does not mean that the broader sector of technology has any less space for innovation or potential for investment. Investors and entrepreneurs alike have collectively learned from the dot-com crash how to innovate and invest in a manner that is safe for the market.