Dot-Com Bubble 2.0 Sparks Fears of Another Bust

Exuberant bidding for startups boosts Silicon Valley bank accounts
By Sam Gale Rosen,  Newser Staff
Posted Oct 17, 2007 12:31 PM CDT
Dot-Com Bubble 2.0 Sparks Fears of Another Bust
More bubbles   (Getty Images)

(Newser) – Remember the dot-com bubble, when companies' huge price tags were based on buzz instead of revenue? Here we go again. Facebook is a prime example: It's valued at as much as $15 billion—half as much as established Yahoo, though the search giant has 32 times the revenue. “There’s definitely a lot of betting going on, and it’s not rational,” one analyst says.

But opinions differ on whether the new boom will be followed by a new bust, the New York Times reports. One YouTube backer says a more web-savvy environment "does open up the aperture for a different outcome this time." Those who've cashed in aren't complaining. “I have to say I giggled,” said the founder of Right Media, who sold out for $850 million. (Read more Silicon Valley stories.)

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