What if we were in a Tech Bubble? The same as the dot.com bubble of 2001 ? The debate has become common in the Tech sector since last year, where the amount of funds raised hit its all time high since 2001.
One of the best answer to this growing fear is maybe one from a partner at Andreessen Horrowitz, the trendy VC firm founded by two entrepreneurs coming from the dot.com bubble : the amount of funding per person online is flat since the bubble. Now internet users pay online on a daily basis, meaning that this time it is different, the funds are not going to ideas that will never find their business model, but to rising economic models online that may be the most profitable models of tomorrow (Uber, Aibnb, Snapchat, etc).
However, most of the observers assume that, Yes, the VC market is « hot » ; and the success of Snapchat and Instagram doesn’t necessarily mean that every photo sharing app that raised more than $50M will be the next big thing, and looking at all the funding to these kind of apps, we could find some sign of overconfidence in the market. Besides, what an impressive sign to see that it is the first time since 2001 when much of the young talent who freshly graduated from Ivy League Universities are flooding to Silicon Valley rather than going to Wall Street, see this article for key figures and examples.
Thanks to CB Insights, we looked at the data for the first three months of 2015 to see what is hot, where are the investments hubs, and which companies raised a lot in this first quarter.
See the slideshare below.