The Dot Com Bubble

The Dot Com Bubble was influential in changing the way people use the internet. During the 1990s, when the internet was just making its way into people everyday lives, two young and motivated developers had two brilliant ideas. These developers were Jeff Bezos and Pierre Omidyar, and their ideas were to create websites that people could use to sell and purchase items using the internet, which meant that they did not even have leave their home. While many big tech names discouraged against taking this on, and often stated that it would never succeed, both Bezos and Omidyar continued their efforts on their own respective websites, Amazon and eBay. Initially, Amazon was designed an online bookstore where customers could find any book that they desired, and then Amazon would ship it to their home. As we know, Amazon today has transformed from this idea of being solely a bookstore and shifted to selling anything and everything. On the other hand, eBay was and still is an online marketplace for people to buy and sell a multitude of goods and secondhand products. While focusing on different markets and demographics, both Amazon and eBay shared the idea that the internet was for business and companies could thrive by selling goods online to more and more people across the world.

With Amazon and eBay taking off in the newly established ecommerce marketplace, Wall Street was eager to get a piece of the pie. With more and more user gaining access to and using the internet the potential to grow small no-name companies to monstrous billion-dollar companies was endless. The only issue that stood in the way of venture capitalists and analysts was greed. While some companies like Amazon and eBay, thrived in the online marketplace other new companies based off wacky and wild ideas stood no chance. With billions of dollars being pumped into the industry a bubble, deemed the Dot Com Bubble, was created and stocks of Amazon, eBay, and other ecommerce sites sored. The use of the mentality “get big fast”, a phrase coined by Jeff Bezos himself, caused many young software engineers to drop everything and try and get a piece of the pie. Sadly, for these new entrants, the bubble was soon to burst.

In 2002, the stock market to a huge plummet causing many investors to lose millions and several companies to end business operations. The combination of the Black Friday crash in 2000 and the 9/11 attacks in 2001 caused the stock market to hit record lows, and therefore causing the Dot Com Bubble to official burst. Many investors were furious with Wall Street analysts, one in particular being Henry Blodget, who drove the rise of the Dot Com Bubble and watched it collapse before his eyes. After in depth investigations and court cases, Blodget was reprimanded by the SEC and banned from trading with IPOs again. Sadly, while Blodget did receive the brunt of the burst, he was not the cause of it.

All in all, the Dot Com Bubble was a rush to get a piece of new landscape in the economic market that was never explored. Companies like Amazon and eBay were able to escape the bubble bursting and go on to become successful, but others were not so lucky. Some see the Dot Com Bubble as a positive though, stating that it needed to happen to give companies a wake call that the internet was here, and it was not going anywhere. Call it what you will, but in the it was pain for gain, and the internet definitely came out better because of it.