The great dot con: Forrester
- 20 April, 2000 12:49
Just as we saw many jump on the bandwagon as champions of the dotcom phenomenon, often these same people are now the ones putting in the boot after VC and retail investors jerked at the knees earlier this week.
Take George F. Colony, chairman and CEO of IT research company Forrester, for example, who prefers to call some of the dotcoms as dot-cons. He recently completed a series of interviews with dotcom and "traditional" CEOs looking for their long-term views on how the internet would affect their businesses and society as a whole.
And his opinion of the people behind some of the stock market darlings of the last 12 months is not that great. "Many dotcoms are about to be exposed for what they are: vapid, shallow, hollow companies," Colony said in an opinion column on the Forrester website.
"Yes, the traditional CEOs were scared by the internet and were scrambling to catch up. But that wasn't what grabbed me. The biggest revelation was the low quality of the dotcom CEOs when compared with the traditionalists."
He then went on to question just what it was that was missing. The answer: a lack of "depth, experience and common business sense", which led him to believe that they might only be there for the short term.
"There was a fanatical focus on valuation -- getting public and liquid -- while value -- what the customer eventually gets -- was a back-seat discussion," Colony said. "In many ways, these companies felt hollow, lacking some of the fundamental ingredients of long-term success."
To be fair, Colony did also emphasise that "some fantastic companies would be built that end up dominating the internet economy". He then qualified this by saying it would "take years of blood, sweat and tears, developed wisdom and enlightened business decisions".
So what does it all mean? According to Colony, "an entire generation of business leaders will be corrupted" while those "with dedicated, wise management will obliterate the hollow-coms. Darwinian forces will take a brutal toll on the weak players."