Key Takeaways

  • Current tech valuations are “pretty fully valued” after recent parabolic moves, according to Brad Gersonner, but this isn't a repeat of the 1999-2000 dot-com bubble.
  • Today's leading private tech companies like Anthropic, OpenAI, and SpaceX are considered “extraordinarily real businesses,” a stark contrast to speculative plays like CMGI, which saw its stock jump from $2 to $2,000 in 1999 with almost no revenue.
  • The market's upward trajectory is now described as a “gentle sinewave,” not the “out of control nuts” environment of two decades ago, meaning growth is more sustainable but still requires active management.
  • Retail investors, and by extension founders seeking capital or exits, should “look down market” for early, compelling opportunities that aren't yet dominating mainstream business news like CNBC.
  • Success in this market demands a recognition of the “jagged line up and to the right,” requiring investors and founders to have staying power through inevitable drawdowns.

The “Gentle Sinewave” is Not 1999 Vegas

Brad Gersonner has seen a few market cycles. When discussing today's tech valuations, he quickly drew a line in the sand, separating now from the late 90s. “99 was Vegas on a Friday night after way too many drugs. Okay. Like it was out of control nuts,” he stated. He recalled how CMGI, a company with “no revenue,” saw its stock soar from $2 to $2,000 in six months. That kind of irrational exuberance, Gersonner stressed, simply isn't what we're seeing today. While valuations are high, Gavin Baker described the current market as “a roller coaster that's… kind of a gentle sinewave,” suggesting a more measured, albeit still upward, trend.

The critical difference? The underlying businesses. Gersonner highlighted companies like Anthropic, OpenAI, and SpaceX, declaring, “These are extraordinarily real businesses.” Unlike the hollow speculations of the past, today’s market leaders are built on substantial products, revenue, and genuine market impact. This distinction means that while the sticker price might cause some sticker shock, the foundation beneath it is far more solid than the froth of 1999.

The “Pretty Fully Valued” Reality

Despite the underlying strength, Gersonner didn't mince words about current prices. “Right now everything in the world of technology is pretty fully valued,” he warned. After the “parabolic moves we've had,” he explained, it's unrealistic to think anything remains cheap. This isn't a prediction of an imminent crash, but rather a cold dose of reality: easy money is likely gone. He acknowledged that the market could still “go higher,” but reminded listeners, “when you've been punched in the face as many times, as all of us have over the last 15 years in technology, we know it's a jagged line up and to the right.” This implies a market that rewards patience and strategic positioning, not just momentum chasing.

Kelly Rodriguez echoed this, noting, “We're watching these valuations and these multiples… saying, 'Wow, these are extraordinary.'” Yet, she also emphasized the need for investors—and founders looking for capital—to shift their focus. She advised, “the retail investor coming into this space needs to look down market and look at interesting opportunities that aren't the things that are on CNBC every day and have access to them earlier.” This signals a landscape where true value is increasingly found off the beaten path, often in earlier-stage companies or less publicized sectors.

What to Do With This

As a founder in this market, resist the urge to chase public market multiples or expect irrational exits if your business lacks substance. Instead, audit your last 12 months of revenue growth against your burn rate. If it's not demonstrably “real business” growth beyond market froth, adjust your fundraising narrative to highlight fundamental strength and long-term staying power. This week, research three private secondary market platforms to understand valuation multiples for companies at your stage, even if you're years from an exit—what metrics are they truly valuing?