EDIT: thanks for all these brilliant responses. Hits great to get the various perspectives. Upvotes are on me!
In: 13
In the late 90s the ‘practical internet’ was born.
While the internet had existed for decades it had only really been used by enthusiasts, big corporations, the military, and academics.
The late 90s saw a boom of internet growth where it became something used in the average household. Email, online shopping, and web surfing became more and more common place.
Lots of startups during this time were trying to get in on the boom but for every Amazon or Ebay there was a dozen pets.com that either had a flawed business model or a business that just wouldn’t work.
A lot of internet businesses like Amazon are actually just the modern version of buying from a mail order catalogue and when people realized that the shipping costs didn’t make up for the convenience of buying from home companies like pets.com collapsed.
Seeing that the internet was a huge untapped marketplace investment money rolled in and a lot of web companies ballooned in size while not generating any significant revenue.
These businesses had stock prices that were way over valued and wall street speculation was rampant.
Eventually the bubble popped and many of these early internet businesses went into bankruptcy. Lots of investment cash disappeared and the stock market took a tumble.
One the prevailing theories is that the market greatly over estimated the speed at which the internet was growing. These businesses might have actually succeeded today but back then the internet didn’t have nearly as many users as now.
The other point is that Amazon succeeded in part because it was able to build on its low-shipping cost book business to put together a massive shipping infrastructure to lower the cost of shipping for every day items.
…That and because it ran at a loss for a long time to put the small book stores that it competed with out of business.
Latest Answers