By Christina Kostopoulou
With Linkedin marking an impressive IPO, many investors wonder how risky it is to invest money in the tech industry. Is it another tech bubble or there’s real profit to be made?
In recent years we have seen very few IPOs as the stock market stays relatively closed to new technology companies. But if we take a closer look at the industry we’ll see that there are many high tech companies out there; technologically innovative companies that have gone public or are ready to do so.
Groupon and Twitter are good examples of companies with revenue models that yes, aren’t proving yet, however the multiples of their overall evaluations are enormous. What remains is to bridge the gap between the two and turn them into real profitable businesses.
The Question is what will differentiate the winners from the losers and what companies will grow over time and become the tech corps of the future. With a proven business model and uniquie services, some of them will eventually capitalize on their evaluations. Microsoft is a good example of a company that succeeded in doing so: it created corporate products that sell continuously.
America is still a good market for entrepreneurs. It’s large and offers a wide range of expertise, two factors that almost guarantee the execution of clever business plans with potential for high profitability. People who look to get venture capital money should start here.
The consumer cloud is a good area for entrepreneurship. All the complexities of IT our now being brought into the cloud, enabling some really exciting applications and services to happen. One such company is Carbonite which enables PC and MAC backup just from a simple keystrock, without having to own any of the hardware needed today to back up.
Another one is Mog. Mog is a music network and service that enables consumers to pay only $10 per month and gain unlimited access to the world’s entire music collection from any device, pc and through various applications.
With the deck industry at its best there’s a new communication paradigm being created. One that changes the way people communicate ideas, whether those are one to many or many to one. Twitter and Facebook, both succeeded in the area of social enterprise field. Many products are now created based on similar business models, like benchmark: a product, allowing businesses to compare their information technology and infrastructure with others, through a private network so they can determine whether they are secure or not. With the recent examples of Sony and Google being hacked, there’s obviously a good prospect of such products.
Many models will be established in the near future. But only those that maintain a continuously profitable business will manage to capitalize. And again, technological innovation and services will be the key to success in this growing competitive industry.
