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 The $1B Facebook plunked down for Instagram has everyone talking. A
lot of pundits are saying this is the peak of the new tech bubble, and
it's all downhill from here when the bubble explodes, just like last
time.
For those around for Tech Bubble 1.0 - circa 1995 to 2001 - there are
similarities, like a company with zero revenue draws such an absurdly
huge valuation. This is on the heels of lofty valuations such as the
Facebook IPO itself.
Before jumping on the Bubble Wagon loaded with tulips, here are 8
reasons why this social computing movement isn't Tech Bubble 2.0:
1) This isn't the search for the killer app. During
Tech Bubble 1.0, that's all we heard. It's email. It's content
management. It's routers and switching. It's storage. It's traffic
management. It's security. Every tech company said they had the formula
that would take over, and built a biz model around it with hockey-stick
growth rates built in, looking to be bought or go public. Investors
believed them, for a while. By contrast, Instagram doesn't even have a
biz model, though there were people trying to offer them one.
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