SortiPreneur

SelectMinds Gets a $5.5m Investment from Bessemer

Congratulations to Anne, Blue and the rest of the team at SelectMinds.  They have just announced a Series A round by Bessemer Venture Partners.

SelectMinds has been clear the leader in parts of the enterprise social networking market.  The challenge will now be to expand the product offering to own what is still a fairly open area.

My bet would be that they will.

First Sign of a New Internet Bubble: Classmates.com

I have been contending that there is no Web 2.0 bubble, until I heard the news:

Classmates filed for a $125m IPO

Now I am scared.  Classmates is as far from Facebook as it can get on the internet, and yet is looking to cash in on the buzz around the entire social networking market.  This is how a bubble gets created - by public market fund-raising that resembles pump-n-dump operations.  Om agrees.
 

NYTimes Free of Times Select

There's quite a bit of buzz in the blogosphere that the NY Times is freeing up the content locked within its Times Select service.  This is great news and one more example of how content wants to be free.

Jim Cramer Meltdown

I enjoy Jim Cramer, both on TV and online, thinking he's a welcome spark in an otherwise drab and conservative field.  This, however, is the maddest I have ever seen him.  He's going out on quite a linb by being so forceful.

Behind the Curtain at a Hedge Fund Meltdown

For those interested in the current tension in the hedge fund world, the letter from the recently-imploded Sowood Capital Management to its investors provides a glimpse into what went wrong.

In this case, it's annotated by Marc Andreessen, which makes it more insightful.

John Dvorak Calls Bubble2.0

And I think he's wrong.  I will go further to say these are the signs that magazines like PC Magazine are losing their relevancy.

Dvorak asserts:

The current bubble, already called Bubble 2.0 to mock the Web 2.0 moniker, is harder to pin down insofar as a primary destructive theme is concerned. A number of unique initiatives, however, are in play here. Let's look at a few of the top ideas floating the new bubble.

Neo-social networking. Today everything from YouTube to the local church has a social-networking angle. And this doesn't even consider the actual social-networking sites, from MySpace to LinkedIn to Facebook to even Second Life. This scene is totally out of control and will contribute to the collapse for sure.

Video mania. With dozens and dozens of YouTube clones cropping up to get on the "throw money away" bandwagon, you must sense that the eventual shakeout in this space will have a negative impact.

User-generated content. This idea has been around since Usenet and just keeps improving. It will make no contribution to the overall collapse except for users reporting the collapse.

Mobile everything. Here is another concept that has been in play since the mid-1990s. It cannot trigger a collapse since it will never fully get off the ground, although the iPhone mania may be a bad sign of something.

Ad-leveraged search. Most search engines will fail as a matter of course. This segment of the industry is mundane. It would be affected by a crash but not trigger one.

Widgets and toolbars. I cannot see the widget scene going crazy, and the jury is still out on toolbars. But there is the potential for nuttiness, I think. The problem here is that these things tend to be dependent on the stability of operating systems and browsers. One bad operating-system patch and suddenly nothing works.

He's right that the above concepts have turned into buzzwords, and many businesses, led by service providers motivated by fees from new work, are spending money on these, and many will see negative returns on their investments.

But, bad business decisions does not make a bubble.  At worst, the above list will come and go as silly fads. 

What does make a bubble is equities trading at prices that can not be justified by traditional financial analysis.  That's what happened in the dot-com bubble and the telecom bubble.

In the current internet scene, the stage where a new business needs large amounts of capital has shifted.  It's much cheaper to start a company, so capital is required to really accelerate growth.  Which means that the sources of capital have better filters and liquidity requirements for investors are not as urgent.  As a result, you see much fewer companies raising public money.  Fred Wilson had a couple of good pieces on this a while back.

When the capital comes from private sources, it's really difficult to call a bubble.

Again, in the worst case scenario, this so-called bubble's worst effect will be a few low-return funds.

UPDATE: Fred chimes in on this article, as well.