The hot topic today is Twitter's £10bn valuation. Given that the social networking site is yet to post profits, this number seems insane: it is based on the potential value of Twitter's users and the possible success of its advertising model - not on cast-iron fact.
Let's view this valuation in the context of Facebook, that great barometer of online success. Mark Zuckerberg has just brokered a deal with Goldman Sachs that will see THE social network valued at £50bn, with Zuckerberg himself trousering around $14bn.
There's an eerie sense of deja vu in the air. We've been here before (albeit for fewer squillions. Inflation and capitalism march on, darling). Valuations in the tens of billions are being bandied about for dotcom businesses - some that are currently loss-making to boot - and there is a sense that we could be about to repeat the sins of our digital forefathers.
But there is a fundamental difference between the state of play in 2000 and here, in 2011. Online business are, in fact, making money. Aside from Twitter, whose 'We'll monetize it later' model is still in its infancy, Facebook made $2bn last year. That's no pocket shrapnel.
Groupon's revenues, trickling in piecemeal though they do as a percentage of each transation, are estimated to be anything from $800m to $2bn.
Even more tellingly, internet users have sky-rocketed. From 360,985,492 folk surfing the web back in 2000, 2010's internet user figures have hit epic levels: 1,966,514,816 at last count (Source: Internet Usage and World Population Statistics).
These people are checking their email, gaming, buying stuff, selling stuff and interacting with friends and strangers every day. In terms of revenue generation, we're talking almost infinite potential.
Add to this the age of austerity (not just a government construct) that set in post dotcom crash. An interview with Mark Pearson, founder of online voucher code giant MyVoucherCodes, yesterday yielded this tip: "Operate as a start-up, no matter how large you grow. Always have too few staff. If you settle into a big business mentality, with staff siloed doing only their individual jobs, creativity and over-achievement go out the window and costs mount up."
Dotcom entrepreneurs are all about the bootstrapping, the cost-cutting and the scalability these days. Not about the quick sale. It is this refusal to sell up at the first sniff of dollar, a la Groupon, which conversely inflates valuations. The numbers go up as entrepreneurs play hard ball with their prized, carefully nurtured assets.
Of course, I could be wrong. The internet apocalyse could be coming. But there's a real possibility that online ventures, like Facebook and Twitter and Groupon, are in fact worthy of their valuations. They are not simply the mythical pots of gold at the end of the rainbow.
Agree? Disagree. Tell me below