Mark Cuban and many other observers see a repeat of the dot-com bubble forming — this time in the startup world. They believe the valuations placed on young tech companies like Pinterest and Uber are ridiculous and only occur because there’s a frantic rush to find the next Facebook.
But one of the tech world’s smartest minds disagrees.
“I don’t think there’s a bubble. I think there’s a huge amount of innovation in Silicon Valley that is getting monetized,” Salesforce.com CEO Marc Benioff told CNN’s Poppy Harlow in an interview at his software company’s San Francisco headquarters.
Benioff believes the current situation is “very different” from 2000, the year the dot-com bubble burst. During that bubble, unproven companies like Pets.com and eToys.com went public despite earning little to no actual revenue. The thinking was that any Internet company would be able to grow to profitability. But many imploded, crashing the Nasdaq and the broader stock market.
The key difference now is that today’s startup superstars “are real companies with very significant revenue streams,” he said. Benioff specifically praised Airbnb, Dropbox and Uber as “very exciting” companies.
Eye-popping numbers: However, even the Salesforce chief acknowledged that things may be getting a little silly.
“For some reason these D-round valuations, which are later-stage rounds, are extremely high. I think that’s the right way to characterize them. I’ve looked at the numbers,” he said.
The numbers are eye-popping. Mobile app SnapChat raised money at a $19 billion valuation in February, doubling its price tag from just three months prior