The bubble! The tech bubble! The Silicon Valley bubble! There's so much bubble talk that we expect some pundits to start traveling like Glinda the Good Witch (UberBubble rides, coming soon to a smartphone near you!).
The bubble makes for good headlines, as Scott Kupor noted in an article he wrote for Fortune about bubble talk, but with big deal VCs like Marc Andreessen saying that people who believe in a bubble "don't know what they're talking about" in a January Wall Street Journal interview, maybe all that is just hype.
Or maybe not, as just nine months later, Andreessen went on a tweeted bubble bender, saying that the end is, basically, near. Some people take nine months to make a baby, but Andreessen used that time to either lose the ability to know what he's talking about, or to see the writing on the wall.
And over the weekend, the New York Times joined Andreessen's doomsday cult, with an editorial headlined "Will Boom Lead to Bust in Silicon Valley?"
According to the Times, the current bubble (if that is what it is! Who knows, everyone might be rich forever!) differs from the last bust because companies like Twitter and Facebook are more "mature" than early 2000s bubble whipping boys Pets.com and Webvan. Stock market valuations are higher, too.
The reason to be worried, per the Times? It's the spending, stupid. "Many privately held tech companies have such easy access to venture capital that they are spending lavishly and burning through cash without a clear plan for turning a profit." Oh, you mean like Lyft's new, mustachioed three-floor HQ, Heroku's (which, had you even heard of Heroku before that Chron article?) "wellness guru," and LinkedIn's lease of an entire office tower in San Francisco (though LinkedIn, at least, might have found a way to make money, albeit a totally sketchball one).
A bursting bubble could be even worse for those of us in the Bay Area than the last one was (though if you were here for the last one that might be tough to imagine), the Times says.
Much more of the current tech boom is concentrated in Silicon Valley than it was in the late 1990s. About half of the $22.7 billion that venture capital firms invested in start-ups in the first six months of this year went to businesses located there. By contrast, Silicon Valley’s share of venture capital investments was less than 35 percent during the late 1990s.
Sadly, the Times' editorial board doesn't offer any advice on how to avoid a downturn, except, perhaps, to make more money. After all, they say, "the valuations of companies can outstrip their ability to make money for only so long."
Good luck, everyone!