If you take a step back and consider how far social media have come in recent years, the wave of IPOs is not that surprising. Some people believe we could be in the midst of another bubble that will eventually burst, but the more astute observer will notice this is simply the zeitgeist and we haven’t reached the apex yet.
LinkedIn is an interesting example because they actually undervalued their value when reaching out to potential investors. Pundits and experts believe LinkedIn entered the market at such a low price, that they left $130 million dollars on the table.
This is in stark contrast to the late ‘90s when Web companies were going public with surprisingly high-valued IPOs, and then feeling the negative fallout. LinkedIn opened at $45 per share and settled at over $120 on its first day of trading almost two months ago.
The dot-com bubble burst a decade ago for several reasons, including the fact share prices soared to sky-high heights that were impossible to support. It should be noted that during the first bubble the Web was new for public consumption, and people weren’t sure what to do with it. The initial response was to throw money at it and hope it stuck.
Today, we understand the Web much better and it is far more ingrained into our personal and professional lives. A growing number of people, brands and organizations are using social media effectively and efficiently, and brands especially require an understanding of social media and an online presence to succeed.
The current landscape coupled with the consistent positive evolution of social media should allow the current version of the climb up the mountain to be much more successful.