Welcome to Dot-Com Bubble 2.0

The dot-com bubble was a watershed event for software developers. You simply couldn't work in the field without having something miraculous or catastrophic happen to you. Or both at once.

This is a companion discussion topic for the original blog entry at: http://www.codinghorror.com/blog/2007/04/welcome-to-dot-com-bubble-20.html

This time I am going to make the millions with my unbranded (but amusing) Super Bowl commercial!

That will be the sign of the beginning of the end once again. Cat herders and the likes will once again bring about our demise.

Chris B. Behrens:

You are correct, we no longer have VCs handing out million dollar checks to 19 year olds. Now we have 22 year olds turning DOWN a billion (with a B) dollars.

A decade ago, very few people had a clear idea of what the Internet was about. Investors got excited about vague terms like “e-commerce” and “the information superhighway”. They were bound to do something stupid.

These days, we have a whole generation who grew up with the thing. Several businesses have grown dependant on http, imap, smtp and a few other acronyms. Every professional in every field can refer to some expert who has studied the dynamics of the Web though a particular lense; during that time techies have been freely experimenting with an overwhelming amount of ideas which are rewriting the fabric of social space itself. Most of the pieces are now on the checkboard. The next move belongs to those who know how to move them to their advantages.

Granted, stupidity is timeless. So, I can only guess the bubble will hang around the same place it’s always been. It will continue to flirt with those don’t see the checkboard: investors who don’t care what kind of services they’re building, companies who won’t learn how to manage nerds, geeks who think they’re solving technical problems, people who go “wow!” too easily, and so on…

What are we to make of that big sense of woweness we’re facing around the big 2.0? – or has it been renamed to 3.0? Should we wait until Web 3.5++ Advanced before buying in?

In my life, far away from the edge of the Bay, my only relief is that JavaScript is finally being taken more seriously. The worldview of 2.0 is also more attuned to my way of thinking. I’m just annoyed of all the excitement and I would gladly to tune it down if I could. We must be making too much noise on the production floor: we are waking up the opportunists.

I live in Montreal, though, so wether you call it Web 1.0, Web 2.0 or veggie sausages, it’s business as usual. I don’t expect any venture capital coming my way, nor do I see incredible salary raise on the horizon. I just think we’re changing the way we develop software and live through with it. And I don’t see anyone taking any notice of it. Not around where I devolve, anyway. Are we more sane or simply oblivious to some kinds of imagination?

This time, if something was to change, I wouldn’t wait for somebody else. I’d ride the waves that look nice to me.

Double, double toil and trouble; Fire burn, and caldron bubble

I completely agree with David P. and disagree with the author.

This is not a bubble. Most of us learned our lessons in the bubble and those who didn’t just don’t learn very well.

The Internet and all that went with it at the time were completely new to everyone, every business and every country on the planet. Now however, these technologies have become a permanent and central part of the daily lives of most people, in some way or form.

On a personal note, I do know how bad the storm was. It left me literally homeless for about six months, living in a tent in the desert and then in an unrelated job after. It completely wiped me out.

So yeah, this time I’m far more careful. A group of very talented designers, developers and experienced business people and I are starting a new company but we are devoting a majority of our time to developing a solid business model and revenue plan. I think this is the significant difference among many emerging Internet-based companies now - that and the exciting evolution of the Net itself.

I was a bit too young for the first bubble. It will be interesting to watch this one.

  • build software that businesses or people can use rather than grabbing for a job, but if ur in a bind and must have a job, then make sure that you have enough to land on when you must bail, having said that the nature of IT will be bubbly cos a lot of wrong notions about how to get rich via IT exist, people think its like real estate - buy it, polish it, sell it to a rock-star, wait till rock-star does something un earthly and gets busted and puts mansion up for auction, buy it again for dirt and sell it for even more as a " cultural icon " - that wont work in IT - cos this is about how smart you are (and hard-working and lucky too, sure) not how deranged and loud you can be - all the deranged and loud ones are the ones they had to wipe off the walls later - amazon started up BEFORE the "first bubble " kept going through that, started to show profits after like 7 years later and look where they are now - its not tough to manage a company moving at the speed of light if you have ur feet on the ground,

the reason indian IT suppliers are so " successful " (the ones that are) are cos for every one bad programmer they have a good one or a good team leader AND they have this policy of " benching " people to avoid burnout, to let them experiment on company time and money - lets face it ABN Amro or Airbus arent going to hire ou to write their systems ONLY cos ur 50 % cheaper –

imho the way to avoid going bust is simple - build B2B services for successful players in growing markets, that way you endear yourself to them as a growth and profit tool too – but if you MUST build stuff for the B2C marketplace, especially services that are innovative,
make sure you have an income stream to pay the bills and live decently until your ships come home, if you did ur homework right they HAVE to be laden with gold.

Hmmm. You are so right but this bubble smells awful. Because of J2EE ruby, ASP and all this stuff. They look like incomplete pieces of a future technology that was abandonded (in the future).

I entered at the worst time: The burst happened right as I stepped into the “professional” web industry - kinda like a landmine. Signed contracts - got “fired” before my first day (long story) - company merged with itself (even longer story) - was absorbed by another - which was absorbed - which eventually disappeared. Kinda reminds me of what happened to Firstar bank. Went on 6 year break from anything resembling “professional” web design/development.

This time around -
Freelance, freelance, freelance (and full-time second job).

I select the clients/studios/projects I want to work with. I select my standards. I select my co-workers. I select my vacations. Basically, I still got a lot of trust issues left over from 2001.

what will you do differently in this bubble?

Staying right the hell out of it! :slight_smile:

I was in a start-up that started in '98 that lasted past the initial crash and into late 2003. I stayed in it because the job market dried up and was using the time to retool myself in the .Net stack. Of course, the company collapsed and I was seriously burned financially. Now I’m working for an investment bank, and it’s very challenging (in a good way).

I was too young for the first bubble too, but think that this one will be much bigger.

When life gives you bubbles - take a bubble bath? I say join the ride.

I was there for the whole bloody mess. I saw the consulting firm I worked for (a dot-com itself) hire hundreds of new developers in a single of year and make them work 80 and 120 hours a week to develop craptacular software with poorly specified requirements under impossible timelines.

But damn, those salaries were good, and the company had one hell of a reputation for delivering product.

Unfortunately the turnover right was sky high. And it was because the company–like many other dot-coms of the time–treated its staff like an expendable commodity that they could burn out and replace cheaply because the market was flooded and venture capital was readily available.

They nearly drove me from the industry.

I have NO desire to go through that again. It’s criminal what those greedy sambatchees did to those kids. I can’t tell you how many kids that went to school eager to be developers in those days NEVER WANT TO LOOK AT A PC AGAIN. Rapid developer burnout.

Money won’t be the deciding factor in what jobs I take; quality of the workplace and competence of the management will be. (And that ain’t no lie: I’ve turned down big money before because it’s not worth the stress and nightmares that go with it.)

Started in a tech company pre-Bubble. Since we weren’t precisely a web-based startup, we didn’t have a problem when the bubble burst. Nearly 11 years later, we’re the #1 provider of our sort of technology in the world, we were bought out by a Fortune 400 company and are still doing well.

The difference between us and the lot of failures? We had a good business model, and we were in (and are still in) a niche that provides a genuinely useful service to our customers, and our customer’s customers. (That’s right–we have an intervening layer between ourselves and the actual end-user.)

That being said, there’s always an element of luck that goes alongside the hours and hours of work, the panic sweats, and the occasional sleeping under the table. It was never a given that what we do would be accepted by the public (as the tech had always failed to capture the public’s interest and imagination before), but we prevailed.

I think it helped to have an actual product beyond a mere web presence.

It amazes me how people (see one of your previous posters) still think that technology is a relavent factor in the internet economy. It is not!

and on a completely different point…

One of the reasons that the first bubble had such a hugh collapse was that people with the money thought the techies had the right idea and the techies thought the people with the money wouldn’t invest in something stupid.

What’s ironic is that a healthy tech start up needs a very small amount of money. The less the better! I met a group of guys during Bubble 1.0 who got 10 million to build a website to sell Jazz tickets. Sureal.

This web bubble seems pretty similar to the last one, except now bandwidth is cheaper and advertising is easier.

@Stu: Your point about weeding out bad developers is spot-on, and I totally aggree. We were flooded with money-grabbers (and will likely be again).

However, I take issue with the fact that the companies that engage in the practices that were so rampant in the first bubble drove a lot of really good, competent people with TONS of potential right out of the industry. And you can bet that history will repeat itself, and we’ll do it again.

I think that, during this bubble, I will create a website with tables all over the place, advertise it through google adstuff, stress it as “the ultimate web 2.5” site (people are going to be bored by this old web 2.0 stuff), blog about every little thing that happen to me at least 3 times a day, and watch the reactions of the web surfers that happen to believe what I say.

Because this time, I really want to get some fun before it crashes :slight_smile:

I’ll be graduating in 1.5 years. Hopefully this “hiring frenzy” is still going on then!