Will IPO's ever get "Bubble Hot" again?

My buddy over at Angry Aussie wants to know!

Who knows!!- hope that helps :)

I do know that I am in New York right now and the energy is electric. I am not in Midtown, Times Square or Broadway, but the Meatpacking District (and I am not looking for a steak!) – not far from the World Trade Center as well. New York is hotter than ever. That was not something the general public though would be the case after 9/11.

Paul Graham has a great piece from September 2004 that is a must read . Paul sold his Company to Yahoo and than worked for them during the “bubble”. I love the whole article and have reread many times and this is my favorite part as it relates to me:

“By the end of the Bubble, companies going public with no earnings were being derided as “concept stocks,” as if it were inherently stupid to invest in them. But investing in concepts isn’t stupid; it’s what VCs do, and the best of them are far from stupid.

The stock of a company that doesn’t yet have earnings is worth something. It may take a while for the market to learn how to value such companies, just as it had to learn to value common stocks in the early 20th century. But markets are good at solving that kind of problem. I wouldn’t be surprised if the market ultimately did a better job than VCs do now.

Going public early will not be the right plan for every company. And it can of course be disruptive– by distracting the management, or by making the early employees suddenly rich. But just as the market will learn how to value startups, startups will learn how to minimize the damage of going public.” END

Flash forward to today where money is very cheap and Private Equity and Angel Investing are all the rage and you see that the IPO has just moved into a different spot on the food chain. Cool companies are being created with $100,000, not $100 million. Internet Companies don’t have to hand over their first round of capital to Yahoo or AOL for home page placement. Bloggers are becoming millionaire’s without investing any capital – just time and passion and knowledge.

No offense to Robert Scoble, Om Malik or Amanda – but please! If they are considered “hot” now (and they are?), imagine what video content and talent will be worth in the coming content boom.

I would say the HUMAN IPO ( the “IPO OF ONE”) has never been hotter! Margin yourself!

3 comments

  1. Minic says:

    Then maybe… there should be a different market for this… the stockmarket of human IPOs, where only shares of skills and talents are traded.

  2. Brian Clark says:

    That idea was floated in the late 90s, when unemployment was tiny and everyone would be a “free agent” in no time.

    Than reality came back and reared its ugly head. :)

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