Technology Company Analysis

The dot-com crash of 2001 taught us that the usual methods of analyzing business still apply to technology companies, although possibly not quite in the usual ways. While we convinced ourselves for a period of years that profits didn't matter and that monetization could be "worked out," we eventually realized that business plans still needed to be solid and have an end goal. Technology for technology's sake was a path to doom.

Unfortunately our thinking still often fails to go past this. In the end the Internet really did change the game and we're slowly coming to realize it. The means of production of content have become so cheap that they're literally being given away. At the same time the ability to track this content and how it performs are more well developed than ever before. This combination has led to a positive revolution in advertising and marketing.

At the same time many of the behemoths of the industry are struggling to keep up. They built their businesses around certain assumptions that were true for a brief period of time but are no longer the case. Today, more than ever, having an effective paradigm for analyzing technology companies is vital to planning for the future.