We didn't start the Fire (2.0)(youtube.com)
youtube.com
We didn't start the Fire (2.0)
http://www.youtube.com/watch?v=fi4fzvQ6I-o
58 comments
And don't forget that most of the "ridiculous valuations" come from acquisition or investment by a few companies that make huge piles of real money in the real economy. If Google, eBay, Amazon, or Microsoft want a company, it might be worth $50 million. If two or more of them want it to compete with the others, then it might be worth $1 billion. If none of them want it, it might be worth $1 million or less. Note that the product, founders, revenue, profit, technology was not one of factors I listed. Just the potential acquirers makes a 1000x difference. And it's ok for these companies to spend money like that because it's money they've already earned from their primary business. That's why it isn't a bubble. Call me when a "pointless revenue-free Web 2.0" company goes public - then we might be in a bubble.
it's very easy to just throw out that acquisitions are of inflated value as well, but as someone who's been in several acquisition discussions with big name tech companies, i can guarantee that these companies don't take the value of a million dollars lightly. these companies are either making strategic acquisitions that are valuable for the tech or hires (valued at low millions), or the user base or customer base, or a multiple of their revenues.
but the one thing these companies are not doing?? "ooh, shiny startup! here's ten million dollars!"
but the one thing these companies are not doing?? "ooh, shiny startup! here's ten million dollars!"
MIT doesn't have a CS degree, only 6-3 or 18-C.
And doesn't offer honors.
Actually, the thing that I absolutely adore is that MIT doesn't do "honorary" degrees. You earn it.
And doesn't offer honors.
Actually, the thing that I absolutely adore is that MIT doesn't do "honorary" degrees. You earn it.
That's just silly. Honorary degrees are just that, honorary, to honor someone. You don't hear people talking about how they received "their degree" from some university when in fact it was actually an honorary degree.
I don't feel like my degree is somehow cheapened because my university gives honorary degrees to people who didn't "earn it".
I don't feel like my degree is somehow cheapened because my university gives honorary degrees to people who didn't "earn it".
I wouldn't say it's silly, I'd just say it's a difference in culture. No need to be defensive. :P
MIT was started as a reaction to other universities whose graduates couldn't do anything "useful." (That is William Barton's word, not mine.) At that time, supposedly prestigious colleges were accepting and graduating rich and powerful students who could talk the talk, but couldn't make any real contributions when it came to math, economics, physics, or any other hard science or engineering discipline.
So, MIT was founded to be a utopia of meritocracy where no one cared where you were from or who your father is, all anyone wanted to know is "can you do the work?" Furthermore, MIT was founded on the principle that if you've graduated from MIT, you are guaranteed to be capable of useful contributions to society. This was considered to be a binary question -- either you're an MIT graduate or you aren't. That's why honor rolls are anathema to the Institute.
At the end of the day, this means that honorary degrees, athletic scholarships, and status-based admissions were out from the beginning because they are diametrically opposed to the mission of the Institute. What was (and is) in? Rigorous math, physics, chemistry, biology for every single graduate, no matter if they are mechanical engineers or music majors.
MIT was started as a reaction to other universities whose graduates couldn't do anything "useful." (That is William Barton's word, not mine.) At that time, supposedly prestigious colleges were accepting and graduating rich and powerful students who could talk the talk, but couldn't make any real contributions when it came to math, economics, physics, or any other hard science or engineering discipline.
So, MIT was founded to be a utopia of meritocracy where no one cared where you were from or who your father is, all anyone wanted to know is "can you do the work?" Furthermore, MIT was founded on the principle that if you've graduated from MIT, you are guaranteed to be capable of useful contributions to society. This was considered to be a binary question -- either you're an MIT graduate or you aren't. That's why honor rolls are anathema to the Institute.
At the end of the day, this means that honorary degrees, athletic scholarships, and status-based admissions were out from the beginning because they are diametrically opposed to the mission of the Institute. What was (and is) in? Rigorous math, physics, chemistry, biology for every single graduate, no matter if they are mechanical engineers or music majors.
>MIT was founded to be a utopia of meritocracy where no one cared where you were from or who your father is, all anyone wanted to know is "can you do the work?"
At $34k a year? The key word is 'founded' I guess.
At $34k a year? The key word is 'founded' I guess.
Actually, MIT has need-blind admission AND guarantees to meet 100% of all admitted students' financial need (as determined by FAFSA). I got well over $120,000 in scholarships without which I couldn't have gone.
How long has this been going on and how well is it publicized? A dozen years ago when I was applying to colleges, I really wanted to go to MIT but tuition was more than my mom earned a year so I didn't even apply. That's great if other good students can avoid missing out like I did.
That's a real shame and, sadly, that kind of thing is pretty common. The school's commitment to meeting 100% of need is not very well publicized, unfortunately. Even now, I talk to many really promising high school students who are discouraged from applying to MIT for the very same reasons you were.
The need-blind admission has been going on forever and the commitment to meet 100% of financial need has been going on for a long time, though I can only say with certainty that it's been in play since 1998 (when I first started looking seriously at the MIT admissions materials).
The good news is that a lot of other "elite" schools are doing this now too. If anyone here knows a smart kid with an expensive dream school, definitely advise them to apply now and worry about the money later.
The need-blind admission has been going on forever and the commitment to meet 100% of financial need has been going on for a long time, though I can only say with certainty that it's been in play since 1998 (when I first started looking seriously at the MIT admissions materials).
The good news is that a lot of other "elite" schools are doing this now too. If anyone here knows a smart kid with an expensive dream school, definitely advise them to apply now and worry about the money later.
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Neat, I like the philosophy. I wonder if they still stick to it, or if they've also become a robot factory over time.
I like to think they've more or less stuck with it. :) There are definitely forces at work that try to water it down by, for example, introduce proposals to dumb down the core curriculum. The good news is that most MIT trustees have sense enough to know that these things will only devalue their own degrees. :P
6-3 is computer science and 18-C is mathematics with a CS focus, right?
I believe the song said "honor roll", not "honorary". MIT does not have an honor roll.
IIRC it has given out one honorary degree, to Winston Churchill.
I believe the song said "honor roll", not "honorary". MIT does not have an honor roll.
IIRC it has given out one honorary degree, to Winston Churchill.
Yup, 6-3 is EECS with a CS focus (you still learn basic EE) and 18-C is math with a CS focus. And you're right, MIT does not have an honor roll, though the professors of certain computer science classes have awarded letters of distinction for outstanding performance during a particular class. This is by no means a standard thing.
MIT has never given an honorary degree. This tradition is so deeply rooted in the Institute's culture that I would bet a year's salary that it won't ever happen.
MIT has allowed certain people to serve as "honorary lecturers." That's what Winston Churchill did.
MIT has never given an honorary degree. This tradition is so deeply rooted in the Institute's culture that I would bet a year's salary that it won't ever happen.
MIT has allowed certain people to serve as "honorary lecturers." That's what Winston Churchill did.
Of course, "earn" is a matter of degree (no pun intended). I mean, MIT has been known to grant "engineering" PhDs for things like this: http://philip.greenspun.com/panda/
Um, no. MIT didn't grant Phil Greenspun a PhD for writing a textbook. He did a little something called grad school.
I would definitely call that the exception rather than the rule.
Since we are talking about "bubbles", here's an interesting read on possibly the first bubble recorded: the Tulip bubble ( http://en.wikipedia.org/wiki/Tulip_mania ). Substituting hackers for 'tulip traders' and web companies for 'tulips' makes for a humorous read :)
I think that most people miss the most important point. The market is the play between players, and their expectations. A bubble is the situation when players' expectations are disconnected from fundamentals and no longer have any ground in the reality.
And while it took literally few months of good acquisitions to create this Web 2.0 hype, much much faster than any fundamental changes arrived, few bankrupctes should be enough to kill it.
Of course, there's still a question what has changed fundamentally since the last bubble? The infrastructure costs nearly nothing, the ad budgets are way higher, as well as number of people using the Internet. However, the services are still rather poor, and nothing paradigm shifting.
And while it took literally few months of good acquisitions to create this Web 2.0 hype, much much faster than any fundamental changes arrived, few bankrupctes should be enough to kill it.
Of course, there's still a question what has changed fundamentally since the last bubble? The infrastructure costs nearly nothing, the ad budgets are way higher, as well as number of people using the Internet. However, the services are still rather poor, and nothing paradigm shifting.
Talk about the 'bubble' has been going on for years now. Does this not indicate that it isn't actually a bubble? Is industry growth really of bubble proportions?
It feels like a bubble in many ways -- full employment (of programmers anyway), tons of "me too" sites. Interestingly there's also probably another recession coming on soon, which will probably have a negative impact one way or another. If we're not in a bubble, we may be at the crest of some sort of ripple or wave at least.
The reason behind full employment of programmers is actually pretty down to earth.
Enrollment into CS programs dropped dramatically when the bubble burst, and has remained low to this day, even though the market recovered in only a couple of years after the crash. It's a matter of inertia, really: it takes a few years for people's perception of the job market to adjust and 4 more years to graduate.
Enrollment into CS programs dropped dramatically when the bubble burst, and has remained low to this day, even though the market recovered in only a couple of years after the crash. It's a matter of inertia, really: it takes a few years for people's perception of the job market to adjust and 4 more years to graduate.
Funny. But is there really a bubble?
A bubble happens when people buy something (stock, real estate or even tulip bulbs!) that they know is overvalued, on the ground that some "greater fool" will arrive later in the party and buy it at a still higher price. It's a kind of Ponzi scheme; at some point, there aren't greater fools anymore and the last players lose.
What we see now may be some misguided investments, bad companies, etc. Obviously, all the crap will end up being cleared at some point. But it's not necessarily a bubble.
What we see now may be some misguided investments, bad companies, etc. Obviously, all the crap will end up being cleared at some point. But it's not necessarily a bubble.
Probably, but this does not mean that there aren't good ideas.
Well, considering most of the buildings from the first dot-com real estate boom AND existing officers are still mostly empty, it's not as bad.
This is great for a laugh ;)
Cute. But I have to remind the makers that "bubble 1.0" was a stock market bubble. We are not in a stock market bubble. The people who are putting money into Facebook are not stock market investors.
Better bust out your TI-89 and crunch out some P/Es. I'll give you a couple to start: EBAY, GOOG, AAPL, YHOO, JAVAD.
JAVAD (Sun) I will give you.
Are you really trying to say that Apple is over-valued?
The stock market bubble (1.0) was based largely on over-valuation of companies that had no profits and no proven business model.
All of the companies you list -- perhaps save for Sun, is it profitable? -- are doing quite well, thank you. Whether they deserve their P/E ratios at the moment: that remains to be seen. But this does not compare with the massive number of over-valuated companies circa 2000. The NASDAQ, for example, sits today at about $2600 -- at the peak of the bubble, in mid-2000, it broke above $5000.
We are not in a bubble of any kind.
Are you really trying to say that Apple is over-valued?
The stock market bubble (1.0) was based largely on over-valuation of companies that had no profits and no proven business model.
All of the companies you list -- perhaps save for Sun, is it profitable? -- are doing quite well, thank you. Whether they deserve their P/E ratios at the moment: that remains to be seen. But this does not compare with the massive number of over-valuated companies circa 2000. The NASDAQ, for example, sits today at about $2600 -- at the peak of the bubble, in mid-2000, it broke above $5000.
We are not in a bubble of any kind.
What's ridiculous is that we're arguing over semantics. I'm going to tell you right now, this is an economic bubble as defined by the mere fact that companies are being valued (privately or publicly) too high. Skype. YouTube. Facebook. Venture funding has been giving quite a lot of money to a lot of me-too sites with little differentiation or real value or even business models.
Just because it doesn't match the hysterics exhibited back in the 90's doesn't disqualify this. And it seems your only argument has been that. I also found your analysis of dot-com companies back then to be lacking.
Personally I don't think it really matters, there are way more important economic issues that needs to be addressed, be it the real estate bubble, credit meltdown, or the war America is engaged in.
Also, for what it's worth: http://online.wsj.com/public/article/SB116679843912957776-fF...
And PS: I own Apple stock. And yes, it is greatly overvalued. And I love it.
Just because it doesn't match the hysterics exhibited back in the 90's doesn't disqualify this. And it seems your only argument has been that. I also found your analysis of dot-com companies back then to be lacking.
Personally I don't think it really matters, there are way more important economic issues that needs to be addressed, be it the real estate bubble, credit meltdown, or the war America is engaged in.
Also, for what it's worth: http://online.wsj.com/public/article/SB116679843912957776-fF...
And PS: I own Apple stock. And yes, it is greatly overvalued. And I love it.
Arguing over semantics is not ridiculous at all. Semantic misunderstanding is at the root of many disagreements.
In this case, the video uses the term bubble specifically as it was used to describe the tech bubble in the late 90s. The video offers a number of cues to suggest this is the intended meaning of the word.
There will always be overvaluations and undervaluations in the stock market. That's the nature of investment risk. What's missing here is a widespread pattern. This is like worrying that Xerox was overvalued for their Palo Alto Research lab-- a valid concern for Xerox stockholders maybe, but no concern at all for the rest of the world.
In this case, the video uses the term bubble specifically as it was used to describe the tech bubble in the late 90s. The video offers a number of cues to suggest this is the intended meaning of the word.
There will always be overvaluations and undervaluations in the stock market. That's the nature of investment risk. What's missing here is a widespread pattern. This is like worrying that Xerox was overvalued for their Palo Alto Research lab-- a valid concern for Xerox stockholders maybe, but no concern at all for the rest of the world.
Potential over-evaluation of some businesses in an industry is not tantamount to a bubble.
"What's ridiculous is that we're arguing over semantics."
We're debating what this all means.
"this is an economic bubble as defined by the mere fact that companies are being valued (privately or publicly) too high"
When you say "bubble" you strongly suggest the current situation somehow compares to what happened in 2000. It doesn't compare.
Yes, this is my only argument. The rest -- that it doesn't matter very much if Facebook goes under -- is obvious enough that I'm not bothering to mention it much. A bubble burst, to most of us, means disaster based on foolishness. There really isn't very much foolishness going on right now.
We're debating what this all means.
"this is an economic bubble as defined by the mere fact that companies are being valued (privately or publicly) too high"
When you say "bubble" you strongly suggest the current situation somehow compares to what happened in 2000. It doesn't compare.
Yes, this is my only argument. The rest -- that it doesn't matter very much if Facebook goes under -- is obvious enough that I'm not bothering to mention it much. A bubble burst, to most of us, means disaster based on foolishness. There really isn't very much foolishness going on right now.
I guess what irritates me is how ignorant these Bubble People are. Any economy can take a downturn, but if you can't tell the difference between Facebook (overhyped but useful service) and Pets.com (worthless), and you think that growth = bubble, you're ignorant. I'm sorry about that, but it's true.
Pets.com had a legitimate business model: they had a niche market, invested in logistics, and they sold stuff over an e-commerce site.
If anything, bootstrapping something similar nowadays and being successful at it would make you look like a genius (a la woot).
What they did fail to do was exercise discretion with their spending. The strategy back in the dot com days was to over-spend in order for the marketing to tip them over. That was the strategy for Amazon from DAY 1 and it took them almost 10 years to make a profit. But Amazon survived because of good leadership while Pets.com obviously didn't because of bad leadership.
And as for Facebook, gee, a supposed 15 billion dollar valuation? Advertising models that's outright creepy? That's growth?
The first bubble was a catastrophe because it involved public money. The second bubble is going to be a headache because it involves private money. But nonetheless when the value of something is way more than the intrinsic value, it's a bubble.
If anything, bootstrapping something similar nowadays and being successful at it would make you look like a genius (a la woot).
What they did fail to do was exercise discretion with their spending. The strategy back in the dot com days was to over-spend in order for the marketing to tip them over. That was the strategy for Amazon from DAY 1 and it took them almost 10 years to make a profit. But Amazon survived because of good leadership while Pets.com obviously didn't because of bad leadership.
And as for Facebook, gee, a supposed 15 billion dollar valuation? Advertising models that's outright creepy? That's growth?
The first bubble was a catastrophe because it involved public money. The second bubble is going to be a headache because it involves private money. But nonetheless when the value of something is way more than the intrinsic value, it's a bubble.
The first bubble was a catastrophe because it involved public money. The second bubble is going to be a headache because it involves private money. But nonetheless when the value of something is way more than the intrinsic value, it's a bubble.
It's improperly termed "A bubble" and every time someone calls it that, it will only make the particular headache worse. When people lose money on bad ideas, that'll hurt, but it'll happen on an individual basis. Calling Facebook's valuation a bubble is like Chicken Little saying the sky is falling. If enough people really start believing Chicken Little, there will be problems; but the sky isn't going to fall.
It's improperly termed "A bubble" and every time someone calls it that, it will only make the particular headache worse. When people lose money on bad ideas, that'll hurt, but it'll happen on an individual basis. Calling Facebook's valuation a bubble is like Chicken Little saying the sky is falling. If enough people really start believing Chicken Little, there will be problems; but the sky isn't going to fall.
You're right. Everything is a-okay!
Obviously Goladus doesn't know about all the layoffs in the tech industry over the past year. Everything is not a-okay, and the scores of programmers sitting at the freeway onramp at University Avenue holding "Will Code for Food" signs should be a lesson to all of us: don't enjoy prosperous times, because they're secretly a bubble that's out to get you.
maybe you can direct all those "will code for food" programmers this way. i don't know of many startup companies who aren't trying to hire...
there's a reason they'll code for food. if they were competent they would code for stock options. (except that you could go hungry trying to eat your stock options)
I don't know... delivering 50 pound bags of dog food in the mail just seems like a bad idea...
"Pets.com had a legitimate business model"
I beg to differ. A legit business model would include a base of customers who wanted to buy the products from the company -- something Pets never had luck with.
"What they did fail to do was exercise discretion with their spending."
That was one of their failures, but not their biggest. The biggest was not having demand, and being unable to create demand. It was easier for people to go to the grocery store once per month than to order online. Comparing Pets to Amazon isn't really valid, since Amazon meant to a seller of everything, and even when they were solely selling books, there was more value-add than Pets could ever achieve. You can shop for books on Amazon in more interesting ways than you can at a physical bookstore. That wasn't true for Pets.com.
"And as for Facebook, gee, a supposed 15 billion dollar valuation? Advertising models that's outright creepy? That's growth?"
$15 billion sounds ridiculous, sure, and it probably is. But that doesn't make a tech bubble. That's just over-valuation. Facebook isn't a public company, and if it went under, a handful of investors would lose money. Not the same as the NASDAQ going from $5000 to <$2000.
I beg to differ. A legit business model would include a base of customers who wanted to buy the products from the company -- something Pets never had luck with.
"What they did fail to do was exercise discretion with their spending."
That was one of their failures, but not their biggest. The biggest was not having demand, and being unable to create demand. It was easier for people to go to the grocery store once per month than to order online. Comparing Pets to Amazon isn't really valid, since Amazon meant to a seller of everything, and even when they were solely selling books, there was more value-add than Pets could ever achieve. You can shop for books on Amazon in more interesting ways than you can at a physical bookstore. That wasn't true for Pets.com.
"And as for Facebook, gee, a supposed 15 billion dollar valuation? Advertising models that's outright creepy? That's growth?"
$15 billion sounds ridiculous, sure, and it probably is. But that doesn't make a tech bubble. That's just over-valuation. Facebook isn't a public company, and if it went under, a handful of investors would lose money. Not the same as the NASDAQ going from $5000 to <$2000.
"I beg to differ. A legit business model would include a base of customers who wanted to buy the products from the company -- something Pets never had luck with."
Based on that, the entirety of Web 2.0 should be an automatic bubble.
"That was one of their failures, but not their biggest. The biggest was not having demand, and being unable to create demand. It was easier for people to go to the grocery store once per month than to order online. Comparing Pets to Amazon isn't really valid, since Amazon meant to a seller of everything, and even when they were solely selling books, there was more value-add than Pets could ever achieve. You can shop for books on Amazon in more interesting ways than you can at a physical bookstore. That wasn't true for Pets.com."
Wow, you don't get it.
The "demand" wasn't there because the majority of people didn't have internet, weren't comfortable with ecommerce, and didn't want to give out credit cards. To survive in that sort of environment most companies relied on massive marketing push. Well, vulture funds gave them plenty of cash to burn, what were they going to do? Invest it in a CD?
They had as much of a legitimate business model as Amazon, their failure was the wanton spending and the inability to sustain their company. But the idea is sustainable, online pet supplies brings up 1.7 million entries on Google. Just because one company failed does not invalidate the market.
Amazon back then had a value add? What was that? Selling books for a loss?
And an economic bubble is defined as when assumed value is more so than intrinsic value. Read techcrunch for more than a month and you'll find plenty of investments or exits for extraordinarily pricing.
Based on that, the entirety of Web 2.0 should be an automatic bubble.
"That was one of their failures, but not their biggest. The biggest was not having demand, and being unable to create demand. It was easier for people to go to the grocery store once per month than to order online. Comparing Pets to Amazon isn't really valid, since Amazon meant to a seller of everything, and even when they were solely selling books, there was more value-add than Pets could ever achieve. You can shop for books on Amazon in more interesting ways than you can at a physical bookstore. That wasn't true for Pets.com."
Wow, you don't get it.
The "demand" wasn't there because the majority of people didn't have internet, weren't comfortable with ecommerce, and didn't want to give out credit cards. To survive in that sort of environment most companies relied on massive marketing push. Well, vulture funds gave them plenty of cash to burn, what were they going to do? Invest it in a CD?
They had as much of a legitimate business model as Amazon, their failure was the wanton spending and the inability to sustain their company. But the idea is sustainable, online pet supplies brings up 1.7 million entries on Google. Just because one company failed does not invalidate the market.
Amazon back then had a value add? What was that? Selling books for a loss?
And an economic bubble is defined as when assumed value is more so than intrinsic value. Read techcrunch for more than a month and you'll find plenty of investments or exits for extraordinarily pricing.
Amazon adds value compared to a physical bookstore because they have many times more titles, including many obscure books that aren't profitable to house in a retail bookstore (the long tail). Unless there are desirable, differentiated pet products that aren't profitable to stock in a store, then the internet model doesn't add value. Are there really a million different kinds of pet food that people could tell the difference between, let alone want to buy? That's the difference between Pets and Amazon.
"Based on that, the entirety of Web 2.0 should be an automatic bubble."
Pets.com was based on selling physical products. Most Web 2.0 companies aren't, but a lot of them are profitable or break-even.
"The "demand" wasn't there because the majority of people didn't have internet"
Maybe. But if your value proposition is "we sell pet food online" you have a larger problem.
"vulture funds gave them plenty of cash to burn, what were they going to do? Invest it in a CD?"
Perhaps spend it working on expanding their market base beyond pet products. Amazon did that, as an example. Alternately, don't take the money.
"Amazon back then had a value add? What was that? Selling books for a loss?"
Things like reader reviews and instantly available critical reviews, suggestions of other books, wish lists -- not to mention the ability to browse titles without having to leave my house. You can't (easily) do any of that in a physical bookstore. And it's why a lot of people started going there.
"And an economic bubble is defined as when assumed value is more so than intrinsic value. Read techcrunch for more than a month and you'll find plenty of investments or exits for extraordinarily pricing."
Defined by you, perhaps. I prefer the way Goladus described it: "Large, risky investments based primarily on the logic that values are surging and will keep surging fueled the inflated valuations."
Regardless of exact definition, a bubble that involves relatively small amounts of private money is not the same as a bubble made of large amounts of public money.
Pets.com was based on selling physical products. Most Web 2.0 companies aren't, but a lot of them are profitable or break-even.
"The "demand" wasn't there because the majority of people didn't have internet"
Maybe. But if your value proposition is "we sell pet food online" you have a larger problem.
"vulture funds gave them plenty of cash to burn, what were they going to do? Invest it in a CD?"
Perhaps spend it working on expanding their market base beyond pet products. Amazon did that, as an example. Alternately, don't take the money.
"Amazon back then had a value add? What was that? Selling books for a loss?"
Things like reader reviews and instantly available critical reviews, suggestions of other books, wish lists -- not to mention the ability to browse titles without having to leave my house. You can't (easily) do any of that in a physical bookstore. And it's why a lot of people started going there.
"And an economic bubble is defined as when assumed value is more so than intrinsic value. Read techcrunch for more than a month and you'll find plenty of investments or exits for extraordinarily pricing."
Defined by you, perhaps. I prefer the way Goladus described it: "Large, risky investments based primarily on the logic that values are surging and will keep surging fueled the inflated valuations."
Regardless of exact definition, a bubble that involves relatively small amounts of private money is not the same as a bubble made of large amounts of public money.
Be careful not to compare the Amazon of 2007 with the pets.com of 2000.
Amazon barely made it through those bleak years. There was a lot of luck involved in their survival. Their business model of "a store for everything" wasn't much better than pets.com that's for sure.
Amazon barely made it through those bleak years. There was a lot of luck involved in their survival. Their business model of "a store for everything" wasn't much better than pets.com that's for sure.
Something tells me you weren't around when pets.com was. At least they were selling something, what the heck is facebook selling?
Pets.com failed because they figured they needed to be a huge company before they turned a profit, as was the fashion. If you launched a similar service today, you'd probably have a great little niche business.
Pets.com failed because they figured they needed to be a huge company before they turned a profit, as was the fashion. If you launched a similar service today, you'd probably have a great little niche business.
"At least they were selling something, what the heck is facebook selling?"
Advertising space to advertisers who want to reach thousands of dedicated Facebook surfers, most of whom are demographically appealing to those with things to sell.
Advertising space to advertisers who want to reach thousands of dedicated Facebook surfers, most of whom are demographically appealing to those with things to sell.
Point taken, but make sure you get mine as well. Facebook isn't exactly a proven model by any means.
Given that most ads are clicked by new or casual site visitors, and that facebook basically destroys this notion by forcing login, they are certainly not a success - yet.
Given that most ads are clicked by new or casual site visitors, and that facebook basically destroys this notion by forcing login, they are certainly not a success - yet.
Facebook and a dozen imitators going public with their stock prices subsequently soaring out of control as people rush to get in on the action, that would be cause for alarm.
Time Magazine covers are the wrong place to look for bubble clues.