I have argued for a long time now that we have seen the better days of a new IT bubble, fired up by fresh printed Quantitive Easing FED money. Seeking Alpha has this article explaining how worries are sailing through Silicon Valley now that the FED flow is drying up. However, the interesting piece of information in this article is the incredible contrast between the number of IPOs during the past IT bubble-mania of 2000 compared with today. At the peak of the previous IT bubble, there were 120 IPOs in an single quarter or two new IPOs every single day (!). One cause is of course that valuations this time around have become so astronomical that their sheer size makes it difficult to IPO them. However, once again the market itself is self-regulating. With some luck, we will be able of avoiding that this bubble pops and we will have a controlled unwind of private capital instead. Three companies will give as a clue: Spotify, Airbnb and Uber are poised for an IPO soon. If those darlings can´t be IPOed, or crash, their evolution and the consequences of it will be the canary in the mine every CTO and CFO in the technology and investment sectors should keep an eye on.
IT bubble? Yes. Worse than the previous one? Maybe not.
