Dot-com Bubble 3.0

Another sign that what Alan Greenspan might describe as "froth" is returning at long last to the Internet economy -- Philip Kaplan, founder of schaedenfreude-slinger Fucked Company, has launched a VC-backed online advertising company. L.A. Times story here.

Comments

[SR]

Is Greenspan subtly implying that the housing bubble is full of santorum?

[joe]

There's no such thing as a national housing market. There are hundreds of overlapping regional housing markets, but they do not add up to a national housing market, in the sense that we have a national automobile or Treasury bond market.

Maybe we have a national mortgage market, which can significantly influence the regional housing markets, but real estate, particularly housing, is too localized for a national analysis to have much meaning.

[NoStar]

Darn it Joe, There you go making sense again making me agree with you. Twice in one month. I am doomed.

[gaius marius]

There's no such thing as a national housing market. There are hundreds of overlapping regional housing markets, but they do not add up to a national housing market, in the sense that we have a national automobile or Treasury bond market.

that's only one aspect of a housing market -- or rather, the housing market is only one aspect of the bubble which ails the united states.

housing may be disparate, but borrowing is not -- debt is a national market that runs across all lines and localities. and a debt bubble is the american problem, of which housing is only a part.

a housing bubble burst is merely a contraction in lending by overextended, overexposed banks. it doesn't matter if you're in tulsa; if new york banking decides to shut the spigot, you're not going to be able to find a buyer for your trailer.

in that essential respect, there very much IS a housing bubble, and it very much IS national.

[gaius marius]

re: Internet bubble -- anyone check the GOOG chart lately? lol -- don't anyone try to claim markets are rational.

[Number 6]

Will this company employ the same scumbag techniqes common to other online marketers (pop-ups, drive-by downloads, tracking cookies, spyware, etc)?

[MP]

old news...those of us still on the FC mailing list got an update from the man himself way back on 3/24. Here's the full sporadic...
==========
Hi,

It's been more than two years since I've written an FC Sporadic. Glad to be
back. A lot has happened since we've last spoken.

And weirdly for many of you, this is your first one ?- lots of new subscribers
since I last sent one. To the new people: You're probably expecting the latest
F---edcompany.com news and such. Sorry to disappoint ?- none of that here.
Just the ramblings of a dorky webmaster living in New York City.

Actually, I live in San Francisco now.

Told you stuff has changed.

(still a dork)

Btw, sorry to suck but I'm gonna censor bad words with dashes n stuff cuz of all
your spam filters would probably eat this newsletter if I didn't... (one more
thing that's changed since i last sent one? spam filters... has it been that
long? yeah)

About 6 months ago I packed up everything, left my friends and my life in NYC
and moved to San Francisco to build a new business, AdBrite.

Not sure if I should give you the story here or not... don't want it to come
across as any sort of a pitch so if you don't give a crap what AdBrite is or how
it started, skip down a few paragraphs.

AdBrite (formerly known as HttpAds and MarketBanker) was a tool I built with
some buddies to allow FC visitors to buy ad space from the site with their
credit cards by clicking "Your Ad Here", easy cheesy.

It was a neat little system so we built it so other sites use it too. Before
long, a few thousand sites were using it to sell ads and it was growing fast.

I knew that if I concentrated on AdBrite I could probably make a big company out
of it.

But leave my cushy life in NYC? No more waking up at Noon, updating FC for an
hour, and spending the rest of the day cashing FC checks and watching porn? (and
spending my nights developing new and innovative ways to embarrass myself in
front of women)?

It was a hard decision, but, like, I'm a man now. 29!

(ya know, i just wrote that 'porn' comment and thought two things. 1) my
investors are probably reading this. investors? yeah. keep reading. and 2)
there's no way this thing is making it through your spam filter)

I figured if I was gonna do it, I wouldn't do it half-assed. (i am full-assed
only). WHOLE HOG as they say (actually not sure if anyone really says that).

So a few months ago I moved to San Francisco ? heart of the Internet biz ? and
just took a $4 million investment from Sequoia Capital (the same VC rockstars
who invested early in Google, Yahoo, Oracle, Cisco, Apple, and more).

Yes, I did.

Seriously.

(and sorry about all the parenthesis..)

I know I know...I spent the last 4 years of my life making fun of dot-com
companies... but all the while I'd secretly look at the successes and think,
"crap, I coulda done that" or worse yet, "i came up with that idea 2 years ago.
dang."

So with AdBrite, "I'm gonna do this before anyone else does".

I don't want this newsletter to be AdBrite spam, so I'm only gonna do this once.
After this, it's back to our regularly scheduled program.

Here's what you need to do: Tell everyone you know who's in the nerd business
about AdBrite. Seriously, send it to all your techie friends. And the
advertiser ones too. If you run a website, use AdBrite:
http://www.adbrite.com/mb/?spid=22

The bigger AdBrite gets, the more interesting these newsletters are gonna get.
Where else do you see a VC-funded CEO writing this kinda stuff? (i still insist
my title be "pud"...we'll see how that goes).

This wasn't too spammy was it?

Reply and let me know. I'll read every reply (especially if it contains
salacious pictures. wink wink. can i still write that?)

Rock on,
Pud

[Some Internet Advertiser]

Err, Adbrite's been around for maybe four years now... originally called Httpads... launched because everyone was begging Kaplan to use his "pay with a card" technology... back in the day that you still visited F'Company.

Christmas '03 I scored some really good 3-month deals with a couple of sites through them (gawker, nerve, fleshbot)... haven't looked as much recently; nothing on them, just, you know, prices went up and locations shifted for the best spots...

[Mark B.]

Joe and gaius are both right - "housing bubble" is a misnomer for what is currently going on in the US. What we have is a Mortgage Finance bubble, which in turn is a manifestation of a monstrous Credit Bubble that dwarfs anything that went on in the Internet-crazy 90's. Like most bubbles, the most severe effects are seen in certain sectors - Bay Area, SoCal, East Coast and New West housing markets, financial institutions, construction, etc. - while other sectors stagnate or even decline. It ain't healthy, and it ain't going to last much longer - once overseas investors start gagging on dollar-denominated debt instruments, things will unravel in a hurry.

Adbrite looks like it fills a niche, but it suffers from the same problem most Internet-centered enterprises do - barriers to entry are so incredibly low that any competitor can come in and start beating you out. Amazon was a pioneer in online retail, but has struggled to make a profit every year of its existence because the big boys jumped in quickly and began slashing margins left and right.

[gaius marius]

It ain't healthy, and it ain't going to last much longer - once overseas investors start gagging on dollar-denominated debt instruments, things will unravel in a hurry.

amen. the next decade will be one of the hardest in american history, i suspect, right there with the 1930s and 1860s.

[joe]

Maybe there wasn't much to be done about the boom in private debt, but piling unheardof levels of government debt on top of that is just downright irresponsible.

[gaius marius]

Maybe there wasn't much to be done about the boom in private debt

fwiw, mr joe, in a semi-planned keynesian economy like ours, there was a lot to be done. if greenspan had acted on his notion of "irrational exuberance" in 1996 with a move to take away the punchbowl, all this could have been averted. instead, he kept rates low until 1999 -- and then, to avoid the painful correction he (and we) had earned, he instigated the current "free money" plan that transferred risk to private balance sheets and destroyed any semblance of personal savings.