In other news, Groupon rejects $5 Billion offer from Google...

... Yip. Been saying it a while. No one I know is listening. Let the chart speak for itself. I took $20,000 in losses the first time around. Won't touch the NASDAQ again.

You didn't buy the dip...just buy the ****ing dips.

Do they even have a proper business model to succeed this time? Ignorance helped the first dotcom craze hit the stratosphere, and now ignorance is refueling 2.0? Greed never rests I suppose, nor does it ever learn. What a disappointment.

Does QEinfinity qualify as a "business model"?

The two-year NDX should bring this into perspective for those who don't think this is a bubble. See any dips anywhere?

Just look at the valuations being tossed around for Twitter.

The company still has no business model. It's a complete joke.

And don't even get me started on the absolute snore that is FourSquare. (A more hype-driven company never existed in dot-com 1.0. It's CitySearch with merit badges. Yeah, that sounds like a money maker.</sarc>)

You're either making money hand-over-fist, or you're not. These lipstick-covered pigs are once again trading at high-negative multiples.

Of course the bottom is about to drop out...

The entire article should be posted for future reference -

Quote:

December 3, 2010, 9:42 pm
A Silicon Bubble Shows Signs of Reinflating
By JENNA WORTHAM AND EVELYN M. RUSLI
Evan Williams, left, who has started several Internet companies, including Twitter, and Fred Wilson, a venture capitalist who says investors are eager to participate in young start-ups.Andrew Harrer/Bloomberg NewsEvan Williams, left, who has started several Internet companies, including Twitter, and Fred Wilson, a venture capitalist who says investors are eager to participate in young start-ups.

In a memorable scene in the “The Social Network,” the actor Justin Timberlake, who portrays the Silicon Valley investor Sean Parker in the movie, leans over the table and tells the founders of Facebook in a conspiratorial tone: “A million dollars isn’t cool. You know what’s cool? A billion dollars.”

These days in Silicon Valley, a billion dollars seems downright quaint. The enthusiasm for social networking and mobile apps has venture capitalists clamoring to give money to young companies.

The exuberance has given rise to an elite club of start-ups — all younger than seven years and all worth billions. Successive investments in Twitter have reportedly increased its value 33 percent, to $4 billion, while Zynga, creator of the popular Facebook game FarmVille, is worth more than $5 billion.

Google was willing to pay $6 billon for Groupon, an online coupon company that was valued at $1.35 billion only eight months ago. And Groupon was willing to reject the bid on Friday evening, presumably because it could sell for even more money later.

Less than a decade after the dot-com bust taught Wall Street and Silicon Valley investors that what goes up does not keep going up forever, a growing number of entrepreneurs and a few venture capitalists are beginning to wonder if investments in technology start-ups are headed toward another big bust.


The chief evidence, according to industry experts and analysts, is the way venture capitalists and established companies are clamoring to give money to young companies, including those with only a shred of an idea. They are piling into me-too start-ups that imitate popular Web companies that already received financing.

Companies that involve social shopping, mobile photo sharing and new social networking are finding it easy to attract investors because no one wants to miss the next big thing.

Yammer, a system for sending Twitter-like messages inside businesses, recently raised $25 million, while investors reportedly signed a check for close to $30 million for a niche blogging site called Tumblr. GroupMe, a new group messaging app for cellphones, raised $9 million. Path, an iPhone app for sharing only photos on a social network limited to just 50 people, received $2.5 million. Its competitor, Picplz, scored $5 million. And those are just within the last few weeks.

It has some venture capitalists scratching their heads.
Dave McClure, founding partner of 500 Startups, a technology incubator. Chris Sacca, below, an investor who has decided to temporarily hold off on new investments until valuations fall.Noah Berger/Bloomberg NewsDave McClure, founding partner of 500 Startups, a technology incubator. Chris Sacca, below, an investor who has decided to temporarily hold off on new investments until valuations fall.
Noah Berger/Bloomberg News

“I’m not saying Quora, Foursquare, Square aren’t eventually worth a lot of money, but the price to pay to get into those games is kind of amazing — $50 to $80 million?” said Dave McClure, founding partner of 500 Startups, a technology incubator in Silicon Valley. “These companies are in big markets with proven founders, so maybe not absolutely crazy but certainly eyebrow-raising.”

Fred Wilson, a prominent venture capitalist, said he had watched the trend accelerate over the last six to nine months. “I am seeing many more unnatural acts from investors happening,” he said in a recent blog post. He attributes it to competition among investors eager to participate in popular young start-ups. And he notes, “I have never seen phases like this end nicely.”

No one really knows if there is a bubble until after one pops. Nevertheless, there are many signs of froth. For example, enthusiasm for closely held Facebook shares has run so high that private investors are trading derivatives of it.

“I always get a little nervous about bubbles when five different angel investors ask me to join their brand new angel funds” in one week, said Alex Gould, leadership scholar of the Stanford Institute for Economic Policy Research. And although the rapid-fire pace of investment in popular Web companies feels reminiscent of the investing craze that led to the dot-com bust a decade ago, there are a few significant differences.

For starters, this is not a stock market bubble. None of the companies are publicly traded.

Mr. Gould said that while “bubble behavior doesn’t change,” the culture of high-flying start-ups like Flooz.com, Pets.com and theGlobe.com making initial public offerings is largely nonexistent. Those did not fare well, though companies like Amazon have continued to prosper.

Instead, entrepreneurs are increasingly looking to large technology companies like Microsoft, Apple or Google with mountains of cash, not the stock market.

Those three companies have about $90 billion in cash on their books. McKinsey & Company calculates that the largest software and hardware companies have enough excess cash on hand to buy nearly all of the tech industry’s midsize companies.

Although the volume of deals is expected to swell, financiers are much more conservative in the amounts they are investing in each company.

“Back in the ’90s, companies got funded for five times the amount that Tumblr raised and didn’t have anything close to a business model,” said Roger Ehrenberg, founder and managing partner of IA Ventures. “People were getting $50 to $200 million a pop and it brought down an entire industry.”

The frenzy is as much the result of simple laws of supply and demand as the herd mentality. Thanks to the constantly falling cost of computing power, a start-up needs less money to get off the ground.

Meanwhile, more wealthy people are viewing investing in technology as a hobby, which has increased the competition.

“Investing in technology has become fashionable,” Mr. Ehrenberg said. “It used to be that angel investing was the province of wealthy men. Now its become the province of everyone.”

Some venture capitalists — hungry for growth and troubled by weak returns — have moved toward smaller investments, hoping to catch the next Facebook in its infancy.

“I think at the high end, it’s not that frothy, but there’s a lot of exuberance in the early-stage stuff,” said Chris Sacca, an angel investor who has decided to temporarily hold off on new investments until valuations drift lower. “A lot of the valuations there don’t make a lot of sense.”

Most Silicon Valley investors still see no signs of gloom and doom. Ron Conway, a San Francisco financier who has invested in more than 500 companies, including Facebook, Zappos, Google and Twitter, says he does not think there is any bubble.

“All the start-ups today have business models and business cases that make them viable,” he said in an e-mail. “In 1999 when the bubble happened many companies did not have business models and advertising on the Web was very immature.”

Jeff Clavier, managing partner at SoftTech VC and a well-known Silicon Valley angel investor who has financed companies like Mint and Ustream, said that over the next 12 to 18 months the real challenge for start-ups flush with venture cash would be proving they were worth the investment or risk having to fold their companies.

“There may not be a big implosion, but down the road there will be a bunch of blood and tears,” he said.

“The music is going to stop and people will realize there aren’t enough chairs for companies to get the next round of financing.”

http://dealbook.nytimes.com/2010/12/03/a....

http://vator.tv/news/2010-11-30-facebook....

Facebook valued at highest ever: $50 billion
Secondary market information makes Facebook worth almost as much as the biggest tech companies

We are again in the twilight zone. This is total and absolute insanity, yet again.

Karl, maybe you should do an IPO for Market Ticker. How about you give (sell) shares to GOLD Members. We can "trade" them on a 'secondary market' here on TF.

My initial valuation work would put the value at $1.3 trillion. You'll have the most valuable internet enterprise of all time. Since we're in a make-believe world these days, why the **** not?

Quote:

Barely a week after we reported on Facebook’s $35 billion valuation on the secondary market, then based on shares sold by Accel Partners, the social site’s value has skyrocketed to its absolute highest--$50 billion.

Most recently, $40 million in Facebook shares have been reshuffled in auctions on SecondMarket, leaving shares at $20.76 with 1.9 million shares traded. According to the report, 2.5 billion shares are left outstanding (taking into account the 5-1 stock split earlier this year), placing Facebook’s valuation at roughly $50 billion, the highest ever for the private company.

For the sake of comparison, Twitter, which once upon a time was seen as a potential major competitor to Facebook, was last rumored to be raising a new giant round of funding (possibly from Digital Sky Technologies) at a $3 billion valuation. Similarly, Groupon, a DST-funded company (reported to have already been purchased by Google for $2.5 billion), was reportedly looking for new funding at a $3 billion valuation. And the biggest business built on Facebook’s platform, Zynga (a DST-funded company), was last reported to be valued at $5 billion.

Neither of these companies come close in valuation to Facebook, though. Actually, it’s more fun to compare Facebook’s latest valuation to the market caps for the biggest and most successful publicly traded technology companies.

Already left in the dust a week ago was Yahoo, whose plummeting value over the past five years has it now sitting on a $21 billion market cap, less than half of Facebook’s current valuation. Facebook's second market value of $50 billion puts it just past eBay, whose market cap is $39 billion right now.

Four obvious tech companies with higher market cap value are Amazon ($81 billion), Google ($186 billion), Microsoft ($217 billion) and Apple ($291 billion).

Plenty of stuff out there that's obviously crazy overpriced - NFLX; Facebook for me too. But I have to say I think GOOG isn't too expensive; about a 20 PE and trading at 5.5 times Cash on the balance sheet; making the right moves in the mobile space and I think, in time, they're going to start chomping into the MSFT home base too.

Facebook for $500BB?!?! Sold to you, more and faster than Time-Warner/AOL.

Sure it's a bubble, but is this 1998, 1999 or early 2000? It's hard to tell. I remember Doug Noland complaining that we were in a real estate bubble in 2002.

How much longer does this go?

They are going to add liquidity until they:

a: Get unemployment below 7% AND get wages to rise.

OR

b: Blow up the entire western economic system

There is no C.

What about TickerForum for 800 billion?

I am thinking that if you play the bubble right you get out early and go claim your lotto ticket. Otherwise goodbye most of the people who somehow haven't heard of the dot com bubble. I guess there are a lot of 12 year old investors who have no thought process and obviously no memories of the past.

Degaston: You are way too low on your appraisal of tickerforum. It's obviously worth more than the Sun. Anyone want to buy some shares of the Sun from me?

Travanx, maybe not twelve year old investors but how about people that were twelve years old when the original bubble burst? Shoot, just throw in anyone who was largely oblivious and/or unaffected when it popped. It's almost hard to believe that it's been twelve years but that's plenty of time for a new generation of suckers to emerge.

Hey, I'll trade my title to this one bridge in Brooklyn for your shares of the Sun. Wait, do you mean the Sun in the sky or the Sun newspaper? It matters not, I'm sure it will be a great deal for both of us!

And look at the next generation of darlings: Pinterest and Tumblr. Both of them are "against advertising".

Uh...so... How does that work?

This is the same old story: give away an awesome service for free, and at some later date (post-IPO of course) promise to monetize the platform.

The "MySpace-effect" is apparently lost on the current generation of investors. But anyone with half a working memory remembers that as soon as Murdoch tried to throw the magical switch and monetize MySpace, the entire thing blew up in his face and he lost everything.

For what it's worth: the only platform of the current crop worth watching IMHO is Tumblr. Major media is *very* interested in viral reblogging. Unlike Twitter, the monetization options with Tumblr are obvious -- the issue is "will they?"

I'm seeing the buy now or miss out for ever comments starting to appear.
But I guess when people have the choice of sticking there money in the bank for no return and Investing in shares where people tell you about there winners makes it hard to stay on the sidelines.