When It Comes to Tech Bubbles, 2011 Is Not 2000

...because 2010 was not 1999
By Mark Russell,  Newser Staff
Posted Mar 28, 2011 2:04 PM CDT
When It Comes to Tech Bubbles, 2011 Is Not 2000
While many warn we are in a tech bubble, other experts point out there are some big differences between this IPO environment and the one in the late 1990s.   (?Stinging Eyes)

(Newser) – With more money pouring into tech funds and some huge valuations for IT companies, there are more and more signs that we're in another tech bubble. But there are also some big differences, notes the New York Times, which compares the tech boom of 1999 with that of 2010. For instance, many more people use the Internet now, around 2 billion, compared to less than 250 million 11 years before. And there isn't such an onslaught of tech IPOs: 308 in 1999, about half of all the IPOs in America that year, compared to just 20 last year.

Most importantly, this new crop of tech start-ups has actual business models this time around. Groupon has been profitable since 2009 and Facebook's revenues continue to grow. “In those days, you had tiny, little companies going public that hardly had a business plan,” said a finance professor at Stanford University. “And now you’re talking about only a few companies—companies that are already global and with revenue.” And with a group so select, things won't go as badly if the bubble bursts, say some investors. (Read more tech bubble stories.)

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