Gurley calls late-stage private market of past two years the most reckless investment behavior since the bubble.
“I think if you look back, could say over the past two years, the most reckless investment behavior we've seen since the bubble was the late stage private market of the past two years.”
Gurley says late-stage private funding behavior is very reminiscent of the late 1990s bubble.
“And the behavior that you'll see for the competition in those dollars is very reminiscent of the late 90s.”
Gurley says capital available to late stage private companies is unbelievable with behavior reminiscent of the late nineties.
“the amount of dollars available to successful late stage private companies is unbelievable. And the behavior that you'll see for the competition in those dollars is very reminiscent of the late 90s.”
Gurley says late-stage private market is the frothiest since the late '90s despite down IPOs.
“I would say on a couple of fronts, the late stage private market continues to be the most frothy thing I've seen since the late '90s.”
Gurley says firms that exited in the late 1990s bubble missed the vast majority of returns.
“But the vast majority of the returns are in these periods at the top of these bubbles.”
Gurley says in the recent boom every venture firm started multiple funds, slowly piling up risk unknowingly.
“And in this past boom, in addition to everyone starting a venture firm, every venture firm started multiple venture firms and growth firms, and all that money gets piled up and you're slowly taking on risk and you don't realize it. It's like the roller coaster goes, nink, nink, nink, nink, nink.”
Gurley says the venture industry is highly cyclical, rising slowly but crashing immediately across three bubbles.
“I've lived through three different bubbles and bursts in this industry, and unfortunately, it's highly cyclical. And when you and and it tends to go up slowly, and it tends to crash immediately.”
Gurley observes venture markets rise slowly but crash immediately, based on experiencing three bubble cycles.
“Yeah. Look, I've lived through three different bubbles and bursts in this industry, and unfortunately, it's highly cyclical. And when you and and it tends to go up slowly, and it tends to crash immediately.”
Gurley argues real technology waves necessarily attract speculation and bubble behavior as pairs.
“If the wave is real, then you're going to have bubble like behavior. Like they come together as a pair precisely because anytime there's very quick wealth creation, you're going to get a lot of people that want to come try and take advantage of that or participate in it.”
Gurley argues real disruptive waves like AI naturally create bubbles alongside genuine innovation.
“And so I think that's where we are right now. It's real, it's disruptive, it's amazing, it it's changing a lot of different things in industry.”