Technology should always be "booming", right? Until the ubiquity of computers, technology was the move from writing to typing, or from manual labor to machines. Then computers came around and allowed for yet another level of automation. Since software is currently the best industry for lowering business costs, we should continue to see a strong market until something supplants computing. None of that speaks about financial bubbles and busts because software is a real industry that provides real value, unlike the recent real estate financial bust which was based on speculation.
What are your thoughts on the amount of speculation in the software/tech market right now? Also real estate is very much a real industry that provides real value (like a roof over one's head)
Technology is always booming, but individual technologies aren't necessarily. The startups that Hacker News promotes tend to be largely SaaS productivity apps. I would be surprised if there isn't a bubble in that area. I recently noted that a startup with the sole purpose of providing other startups with "coming soon" pages has $800k of funding. How on earth can they expect to become profitable after sinking 800k into a very niche service. There can't be that many startups in need of a "Coming soon" page, can there?
In the victorian times, the technology booming was railways. There was always a market for railways (until the car came along, but that wasn't really for another seventy years), but the real issue was the number which they built. There was passengers, but not enough to support the frantic investment that people were making (it was, after all, the next big thing!). This is where I see the VC backed SaaS startup investment market going. Frankly, there cannot really be a market for every SaaS app we see traipse through here with $10m of backing. The real question is, how long until the failure rate becomes high enough that people panic?
YCombinator has the right idea. Start with a small seed, build a good app and perhaps only once you have something launched, start looking for more investment. A website can generally lead to profitability either by being loss making but really, really popular, or by having revenue from day one. What worries me is the websites that have very little revenue from the beginning, and yet are attracting multi million dollar investments. That cannot last.
As an aside, we're thankful for those rail investments now - the UK not only has a very large railway network, we also have a very large bicycle path network built on ex-railway lines!
