So How’s Tech Bubble Number 2 Panning Out?

For indispensable reporting on the coronavirus crisis, the election, and more, subscribe to the Mother Jones Daily newsletter.


At the LA Times today, Erin Griffith comments on the latest tech bubble:

Each day there’s a new report casting gloom on Silicon Valley’s herd of magical billion-dollar “unicorn” start-ups: missed targets at Zenefits, share markdowns at Snapchat, a cash crunch at Jet, an executive exodus at Rent the Runway. Dropbox faces doubts about its revenue potential. Theranos is losing business deals. And don’t forget WeWork’s highly risky real estate deals, and unrealized revenue projections at Lyft. Flipboard failed to find a buyer. Square priced its IPO underwater. Zirtual and Homejoy — not unicorns, but highly valued and highly funded all the same — abruptly shut down.

Each new report is shocking because we receive little information on the health of these private companies — we know only what they choose to share. Usually those are impressive-sounding figures like “400% revenue growth” (from what base? $1?) or a robust “revenue run rate,” a decidedly non-GAAP measurement. Worse are the totally meaningless, hard-to-contextualize stats: Start-up X has reached 5 billion “impressions” per month! (But what about profits? Does this revolutionary business model actually work? No comment.)

Needless to say, those of us who were alive 20 years ago are familiar with this. Even the terminology hasn’t changed much. Back then it was run-rates and impressions and record revenues and “decidedly non-GAAP measurements” too. You’d think we might have learned something from that. I mean, say what you will about our 17th century ancestors, but at least they didn’t have a second tulip bubble in 1657.

That’s not fair, of course. This is more like the railroad mania of the 19th century: genuinely useful technology that got out of hand and produced plenty of fraud and speculation to go along with a transportation revolution that changed the world. Still, you’d think we would have learned something from that, too.

Of course, you’d think we would have learned something from the invasion of Iraq, but apparently not. You’d think we would have learned something from the financial meltdown, but apparently not. We humans just don’t learn much, do we?

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate