IPOs are priced a bit below what’s perceived as fair value and investors almost always fight over the stock right out of the gate. Not Uber though, and it’s another sign that we’re in the late stages of the tech and global stock bubble.
When we were in the late stage of the last tech bubble, in 1999, a swarm of Internet stocks with no profits, and only some with little sales, came out of the woodwork with super-high valuations. That’s what I call the infancy stage of a new technology where you actually see the most extreme bubble versus valuations (something Rodney will be talking more about in the coming weeks).
The next S-Curve wave emerges on a tiny scale as the previous S-Curve is peaking after surprising everyone with its growth and scale. That makes the new companies look like the next big thing. They may well be the next big thing, but not right at the beginning of the curve.
Yet, investors always over value technologies in their early stages… when they’re small, unprofitable, and slower to have impact.
They then greatly underestimate them in the longer term (that’s the trouble with our natural inclination to think in linear terms).
This is what’s going on with Bitcoin, cryptocurrencies, and blockchain technologies today. They’re in their infancy, just like the Internet was in 1999. Investors got burned… and then when the players were ready for the real lift off in 2001 – 2002, most missed the launch.
Mark my words: blockchain is the next S-Curve in the Internet arena. It’s the Internet 2.0, only on about a 20-year lag. Starting with a wild and crazy bubble based on minimal sales and no profits, by the top of the next global boom, around 2036/7, it will be one of the next big things.
This is also what’s going on in the present “unicorn” bubble of IPOs. Look at this chart of 12 recent IPOs, executed or about to…