On Bubbles ... And Why We'll Be Just Fine
This post originally ran on TechCrunch. — I recently spoke at the Founder Showcase at the request of Adeo Ressi. I asked what the audience most needed to hear. — He said, “They need an unbiased view of the fund raising environment …
Context & Ripple Effects
This essay lands mid-stream in an argument that has run for years. In January 2006 the case was made that 'Bubble 2.0' existed chiefly in media coverage rather than company fundamentals [[a:1176505]]; in October 2007 Marc Andreessen conceded on his blog that it was, in fact, a bubble [[a:1180465]]. By June 2011 the question is live again, and here the Both Sides of the Table author takes the reassuring side, arguing to founders that the funding climate will leave them fine.
The setting matters: Adeo Ressi specifically asked for an 'unbiased view of the fund raising environment' at the Founder Showcase, and the post reaches a wider readership through TechCrunch — the same outlet that, weeks earlier in May 2011, publicly disclosed financial conflicts tied to its editor's investments and reaffirmed transparency toward readers. An investor delivering a market verdict through a venue that just formalized its conflict-of-interest policy is exactly the tension this debate turns on.
First-order effects
- Founders in the Founder Showcase audience get a direct, on-stage read of the 2011 fundraising environment from an active participant — actionable guidance on whether to raise now or hold back.
- Running the argument through TechCrunch extends the reassurance far past the room, putting an investor's 'unbiased' market call in front of the same readership that just watched the outlet disclose its own investment conflicts.
Second-order effects
- Public bubble reassurance from investors with money in the market functions as signaling: founders who believe it are more inclined to raise at prevailing terms, which feeds the very funding activity under debate.
- A confident 'we'll be fine' invites opposing essays from other investors and commentators, keeping the bubble question a recurring editorial battleground for outlets like TechCrunch rather than a settled matter.
Third-order effects
- If the pattern holds, the bubble debate reopens with every funding cycle, and each participant's stated position tracks their exposure — meaning the argument itself becomes a feature of the capital cycle, not neutral commentary on it.
- That makes disclosure regimes for investor-media hybrids structurally important: when market-shaping opinions come from people invested in the outcome, policies like TechCrunch's stated commitment to transparency become the main check readers have.
The trend: Every venture funding cycle revives the bubble debate, and investors' public stances increasingly operate as signals inside the very market they claim to be describing.