The dot bomb era was the period of time following the dot com bubble of the late 1990's and into 2001. During the dot com era, Internet based businesses flourished. They were mostly funded by venture capital and banks looking to cash in on the Internet trend.
When the dot com bubble burst in the early 2000s, stocks sunk and hundreds of companies went completely out of business. Thousands of other companies laid off a large portion of their workforce.
I learned in the class that, it was a painful time in the technology industry, particularly for those who had planned their mortgages and/or retirements based on the prices of the technology stock they had been awarded or held in their stock portfolios. “Wealthy” investors lost their fortunes, and millions were left wondering what had gone wrong.
Some of the main reasons were:-
• A general economic recession during this period.
• Findings of corporate corruption, and the subsequent bankruptcy, at several large companies, including a few large technology companies.
• Stocks being overvalued and companies lacking enough of a sound business plan to back up those numbers and turn a profit.
In 1994 to 1998: Large, Internet-based companies were founded one after the other, among them Amazon, Beverly Hills Internet, Craigslist, Pets.com, MSN, Flooz.com, Go.com, and more. In 1998: Interest rates fell, contributing to increased start-up capital.
In 1998-1999: Taking advantage of the increased momentum, more companies started up, including Kozmo.com, Google, WebVan, MVP.com, etc. In 2000: Bubble reaches peak as the NASDAQ reached a value over double that of the previous year. In 2000-2002: Companies fold and go bankrupt.
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