The dot-com crash wiped out startups and investor confidence within months

Evidence

Startups with outsized valuations just months earlier were suddenly forced to shutter. Prominent articles such as “Doom Stalks the Dotcoms” noted that the stock prices of Wall Street’s most-revered internet “high flyers” were “down for the count,” with many of them trading below their initial offering price: “With many dotcoms declining, neither venture capitalists nor Wall Street is eager to give them a dime.…” The news brimmed with descriptions of shell-shocked investors. The week of April 10 saw the worst decline in the history of the NASDAQ, where many internet companies had gone public, and there was a growing consensus that the “game” had irreversibly changed. — Shoshana Zuboff, The Age of Surveillance Capitalism, 224

Categorization

• XREF: This collapse is the background condition that forced Google toward a new revenue model, connecting to the chapter’s causal narrative. — connects to: Web 2.0 revived tech optimism after the dot-com crash dismantled it — Alice E. Marwick, Status Update: Celebrity, Publicity,…, 54; The 2000 dot-com crash abruptly ended Google’s fundraising confidence — Shoshana Zuboff, The Age of Surveillance Capitalism, 223; The dot-com crash stemmed from advertisers’ inability to prove online ads worked — Tim Wu, The Attention Merchants, 891 (+5 more)

Broader Connections

• Financial bubbles burst when future-productivity claims lose credibility #corroborates (0.80) — Max Haiven, Cultures of Financialization, 497
• The dot-com crash stemmed from advertisers’ inability to prove online ads worked #complicates (0.75) — Tim Wu, The Attention Merchants, 891
• Severe financial crises trigger a loss of trust in markets #expands (0.70)