The money men always seem to want a new dream to tilt at and, with the evaporation of the private equity mirage, the next new dream is tech.
Tech is having money chucked at it by the venture capitalists. Trouble is that tech investing, in an age when it costs $70m to get a chip to market, is more likely to mean internet than engineering.
Apparently the new premise on which investors are investing in internet companies is: How many users? Not: How much money is it making?
Apparently, internet entrepreneurs are saying amongst themselves it’s best not to have revenues, because having them can limit the imagination of potential investors.
It’s easier to convince an investor or a buyer that you’re the next YouTube if you’re losing $1m a year than making $1m.
The founder of social networking site Twitter was quoted recently as saying that the company was not focused on making money, and no one in the company was even trying to figure out how to make money.
Twitter is a San Francisco company, the city of 60s flower power, anti-materialism and Haight Ashbury hippies.
Twitter’s god, the god of Web 2.0, is traffic. Get the traffic and everything else will take care of itself.
Subscribe to this blog's feed