Is it ‘irrational exuberance’ all over again?

Those were the days

Those were the days

Twitter Inc. will start selling shares to the public about Nov. 6 at a price that values the company at $11 billion, impressive for an outfit that loses money on every new dollar of revenue it generates.

But at least Twitter has revenue. Pinterest, an electronic scrapbook service that has yet to record a dollar of income, is valued at $4 billion, and even younger Snapchat Inc. is aiming for a similar valuation.

Does this remind you of the dot com bubble of 1999-2000, when companies like Pets.com  and Webvan blew through piles of investor money before sinking without a trace? Well, the experts say it’s different this time, but they always say that until the market collapses.

Certainly, it’s starting to look like the good old days on the San Francisco Peninsula. Home prices in San Francisco and surrounding counties are up more than 15 percent in the last year, and office rents in San Francisco are 23 percent above their 2008 peak. There’s a long waiting list for Tesla cars, which go for about $75,000.

To be fair, some of the people benefiting the most from the run-up in stocks are urging caution. Tesla CEO Elon Musk said the company’s stock “is more than we have any right to deserve.” Maybe that’s because the company, which has had one profitable quarter since going public in 2010, is valued at $20.6 billion–seven times its expected 2014 sales.

Then there’s Netflix, a company that actually produces consistent profits. Still, CEO Reed Hastings cautioned shareholders that the company’s stock is benefiting from “euphoria” driven by “momentum” investors. Netflix shares have tripled this year.

Those kinds of gains keep the money rolling in. Pinterest said last week it has raised $225 million from venture capital firms, even though it hasn’t spent the $200 million it raised in February. The new money values the three-year-old company at $3.8 billion, a 52 percent jump in eight months.

Dozens of other startups are in the pipeline, hoping to capitalize on the investor fervor, and last year’s Jumpstart Our Business Startups Act will make it easier for small-time investors to back startups. Venture capitalists back winners just 20 percent of the time; how do you think neophytes are going to fare? (Here’s a good rule of thumb to follow: When the big boys let the little guys into an investment opportunity, you can assume that all of the good opportunities are gone.)

When the last dot com bubble collapsed, the following bumper sticker became popular in Silicon Valley: “Please God, just one more bubble.” Those prayers may have been answered.

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