Silicon Insider: Inside the Tech Turnaround
Nov. 20 -- Armies are on the march…
They are shielded by forests and hills, but sometimes you can hear hoofbeats, or catch a flash of polished steel or see a moving cloud of dust.
Most people who operate outside high tech — and many who work inside — don't full understand how a tech boom actually works. The most popular myth is that one morning the digital world arrives at the office, discovers a pile of new orders in the lobby, and the good times are on once again.
A second, more subtle, myth is that once every dozen years, overlaying the natural four-year boom/bust cycle of tech, a revolutionary new technology comes along — the integrated circuit, the PC, the Web — that gooses an interval of good growth into hyper-expansion. The resulting bubble makes a few people super-rich, a bunch of people quite rich, and millions of people furious because they thought they were going to get rich too.
A third, financially oriented, myth argues that what actually occurs is that a key tech company, combining a hot new business with good market timing, goes public. Investors, enamored with a cool new technology in a brand new market of indefinite size, sends the stock through the roof.
This explosive creation of wealth sends shock waves out through both the financial and tech communities. Investors embark on a frenzied search for the next hot offering; venture capitalists see an exit for their existing investments and begin lining them up to go public; and entrepreneurs, seeing the coffers of the VCs finally open again, quick gather teams and prepare business plans to make their own dreams a reality.
Three myths about high tech booms. All are true, yet none is definitive. In truth, all are merely descriptions of the outward manifestations of a tech turnaround. They are not the underlying process. And anyone who waits for these secondary signs to join the game are already arriving too late to make the big score.
Related Stories
ABC News Live