During last year’s Web 2.0 conference, when everyone was saying “the bubble is back,” I decried all the bubble blowing and said that it isn’t a bubble if everyone knows it is. Really being in a bubble is like swimming in the proverbial goldfish bowl: you can’t see beyond the walls. I ended by saying, “I think it’s too early to declare a bubble, just because investors are excited again. Investors get excited professionally; bubbles require much more pervasive delusions.”
Things seem much more pervasive this year — maybe not delusional, but certainly inflated. I went to lunch yesterday with a friend who runs a business helping web companies; she says business is up about 400% this quarter versus last. It feels like the 90s, she said. (She also bought — thanks, friend!) An investor friend writes in email that firms are rushing to get deals done fast again, trying to cut off competing firms. “That just makes for bad dynamics all around. But that’s what is happening.” In bubble central, San Francisco’s South Park, I ran into a Wired writer I hadn’t seen in a while, and he made me laugh out loud by saying as he walked by, “It is happening again!” (Don’t watch past 1:03 in that video, directed by David Lynch, unless you’re up for seeing horrifying violence. Maybe an analogous warning should apply here, too.)
The lifeline running through these stories is awareness of what’s happening. I still don’t hear people saying that the entirety of the business world is about to be swept away. The tech world is highly cyclical, and the cycle definitely seems to be on the upswing at the moment, with all that means, for the service providers, the investors, the journalists, and the entrepreneurs. As an entrepreneur working on a new business, I’m not happy about that. I’d much rather be starting off in a world where people are surprised to see something new. But the world is what it is, and I hope and believe there’s no bad time to start a great business. Even now.