In case you've been living under the proverbial rock, LinkedIn finally made good on their IPO promise, and essentially shattered expectations of how the stock should perform. This is good news, right? I mean, Linked In is a pretty decent company (I have an account on there), and this could pave the way for other tech companies to raise some capital in the stock market. America is getting back on it's feet, the boys are back in town, jailbreak, and any other Thin Lizzy song you can think of at the moment.
Feels good, right? Welcome to Internet Bubble 2.0. I can't wait to get my discounted pet food below cost again, and I don't even have any pets.
Why the doom and gloom? Think about it for a moment. Wall Street loves to bet on technology stocks. They're cool and sexy, and the hot new thing. Who doesn't love being part of the latest technology? And Wall Street has had to sit on their hands since Google went public to get in on the next big technology IPO. Google went public in 2004. So, Wall Street has had to wait for 6+ years to get it's groove on, and romance the next big tech IPO. And loneliness has not made Wall Street any less horny. Nope, Wall Street has oogled every Facebook, Twitter, and God-knows-what-else hoping that they'd prove an easy IPO. And who should emerge from the social media brothel, but LinkedIn. Good ol' LinkedIn, the Classmates.com for the business community, where you can keep track of your graduating class of work-place mates, and plan out new business relationships and hookups.
Sure, LinkedIn might not be what Wall Street was looking for, but any port in a storm will do when your desperate. And desperate Wall Street was, performing what best could be described as National Geographic sex on the first day of trading.
LinkedIn might have some intrinsic value in the short-term, but the Internet is a fickle beast. Tomorrow, we might see half of LinkedIn's staff move to create a new company, or some other Internet start-up might tickle the fancies of the digerati and provoke yet another eyeball exodus to the new service. And investors will yet again be left holding the bag (or used tarp, as the case may be) of the remnants of that exuberance. Now is not the time for irrationality; that's what got us the recession in the first place. Now is the time for careful consideration, thoughtful execution, and patience. Because while the IPO for LinkedIn may be a quickie for Wall Street, it's not the long-term relationship that investors really need.