With acquisition feelers out to Twitter for a reported $8 billion to $10 billion, bubble talk is once again the topic of discussion. It's a recurring theme, and on this episode of Founder Stories venture capitalist Fred Wilson talks to Chris Dixon about the frothy valuations in Techland. Wilson is careful not to use the word "bubble," but this is familiar ground for him. He he has been vocal about signs that he finds disturbing, such as investors chasing returns and startups with little more than three founders in a garage getting bid up for no reason. In the video he specifically calls out Quora and its instant $86 million valuation as troubling. Yet by the end of the clip he also concludes that Facebook is going to be worth a lot more than $50 billion. Wilson's firm Union Square Ventures is an investor in Twitter (although this show was taped before the current deal talk rumors came out), as well as Zynga, Tumblr, Etsy, and Foursquare. So he's seen a lot of the rising valuations first-hand, and is benefiting from his early investments in these companies. But it is getting harder and harder, and he is honest about the fact that sometimes he is getting outbid by other VC firms like Sequoia. Dixon, who in addition to running Hunch is a very active angel investor through Founder Collective argues that there isn't a bubble at all because the fundamentals of Internet companies are so much stronger now and creating real revenues.
Source: http://feedproxy.google.com/~r/Techcrunch/~3/4cHtvyHi2kg/
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