Friday, January 14, 2005

Dot Com Redux

It's been a source of much mirth and some dread to me lately that so many discredited names from the dot com era are re-appearing on the scene. Apparently, penance is now complete, and they're back in the thick of things, re-charged and ready to play again with other people's money. Current areas where they are kicking up dust include: blogs, search engines and almost anything to do with online advertising. These once again respectable troublemakers all became household names at the height of the boom, and you can find them largely in the same old places.

There's the Wall Street analyst crowd, directly or indirectly responsible for the gaping holes in most of our401(k)'s, and they're back touting Internet stocks again. The crazy thing: people are listening to them, respectfully.

There's that certain group of venture capitalists who are back telling their investors that they see the future more clearly than anyone else, just like in the old days, only this time they're even more sure they are right.

There are the empire builders, whose strategies typically involve buying everything in sight as quickly as possible. That these characters can continue to find financial backers is remarkable, especially since the amount of funding they have appears to be a multiple of the amount they consumed in their previous failed attempt to do the same thing.

Of course, if your previously high-flying dot com experience left you "burnt out," "re-examining priorities," or unable to resume your former occupation due to a settlement agreement with some regulatory agency, there's always journalism. Yes, some of the same group that shamelessly worked gullible reporters to hype themselves and their various ventures are now ... reporters, presumably far less gullible, although time will tell on that score.

Perhaps the greatest irony is that this group was not wrong in their initial embrace of the Internet. It has changed the world. But those who are now succeeding on the Internet have gotten there by dint of hard work and commitment, building businesses one customer at a time, and slowly and often painfully moving their much-maligned "traditional" businesses to the Web. In the process of doing this, we learned that all the old rules of business still apply. And that's why the "smart money" crowd won't succeed this time around either: they believe that their particular combination of smarts and money allows them to move immediately to the head of the line, shun long term thinking and bend or ignore rules at will. Ultimately, their only success will be in glamorizing failure.
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