A Second Tech Bubble?

So says the Wall Street Journal:

The goofy-names index, for example, is back near its previous high. Consider Orgoo Inc., which helps people organize all their Web communications. Or Zipidee Inc., a purveyor of “digital goods” such as cellphone ring tones. “Are these names of dogs or are they names of companies?” asks Kate Mitchell, a venture capitalist in Foster City, Calif.

The rate of odd-looking start-ups, too, is on the rise. One called Startup Schwag exists solely to deliver a monthly package of T-shirts and other goodies bearing logos of other tech start-ups. Rapper MC Hammer, known for 1990s hits like “U Can’t Touch This” and a 1996 bankruptcy filing, is chief strategy officer of an online-video start-up called DanceJam. PlaySpan Inc., a Web-gaming outfit that raised $6.5 million, boasted on its Web site that it had been founded by a fifth-grader.

Then there’s this familiar froth indicator: Some office landlords in Silicon Valley are again accepting stock in still-private start-ups in lieu of rent.

“It is absolutely déjà vu,” says David Chao, a venture capitalist in Menlo Park, Calif., who reports seeing lots of bad business ideas, from ever-younger entrepreneurs. “There’s just as much junk now as there was in 1999,” he says.

I would tend to agree… as there are plenty of ideas out there, and plenty of beta startups, but not much momentum. Those startups who are able to get up that momentum and really make a go of it, are able to because they are on top of what they need to do to make an impact. For instance, business finances are at the core of every startup, that is where a valuable asset like an accountant is needed, with companies like Early Growth, and others, being utilized to make it easier for them to keep going.

OTOH, look at the risk/benefit analysis. It’s not like Google is an ordinary name either, and the ROI on something like that has turned into a Microsoft competitor — a feat unimaginable during the 1990s when Netscape was only expected to make a dent into the web browser market.

And forget the operating system (where MS is still unrivaled)… when it comes to games, Microsoft will dominate.

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