Think about all the startups who rely on AWS, Apple computers, and Facebook ads. What happens when they all die?
The tech bull run is over, and we'll find out where the bodies lie soon.
It's really weird how many people seem to _want_ the tech industry to just wither and die. It's unlikely and unrealistic. There may be a sharp correction, but it's unrealistic to think that the behemoths with a moat are going anywhere.
We don't even know the market demand for these products because cheap money has made everyone a startup founder, and every company pivoted to providing a "tech" solution when it might not have been economically viable or provided any profit.
You wrote: “Since most tech/saas companies sell/support other saas companies, they all go down.”
Meta/Goog are (eng staff wise) oversized for their output. Both of their leaderships aren't leading very well.
Despite the hype and capabilities offered, none of the big players have find ways to use their AI assets. That's a poor indicator of their future. You can almost smell the disruption coming..
I don't think there is anything substantial here to suggest this is anything other than a normal recession and even if this was like the dotcom bubble, these companies aren't like dotcom era startups. They're massive behemoths intertwined with the fabric of American society, not to mention their warchests make most other companies blush.
Then I'm guessing you haven't been paying much attention to anything.
Have you seen what's happening in the bond market these days? Looked at the insane actions the BoE is taking coupled with their insane tax policy? Have you seen the rising dollar are you aware the threat that makes to the entire global credit system?
This is literally just getting started.
I was not aware of the US bond market crumbling, and having a quick read it doesn’t seem to be, it seems to be a consequence of the fed raising rates which will obviously not continue indefinitely.
To be honest it still seems like a normal recession but with a bunch of hyperbolic news headlines attached.
Too much cheap money and a grow at any costs mentality has lead to exactly this is problem where every tech company is very tightly coupled with every other tech company.
I'm in the B2B space for one of the many non-profitable, recently IPO'd companies. As far as companies goes, this one is pretty sane. Healthy growth, a product that makes sense, thoughtful leadership. However when I look at our customers the vast majority are small tech startups, many of which will obviously cease to exist in a down turn.
When I look at our spending, it's mostly to other larger tech companies, those big tech companies everyone wants to work for.
But those small startups, that have weird products that don't make sense, price sensitive customers, unsustainable growth and crazy leadership, they make up a huge amount of our revenue. When they start to collapse, we'll have to downsize, both in headcount and in services we pay for. And we won't be alone.
On top of that, I look at my own spending. My other tech friends and I have no problem paying what would have been crazy amounts for services like Door Dash, or a constant stream of slightly over price but so convenient stuff from Amazon. Why not subscribe to another streaming services, it's only $10/month. So many of these direct to consumer companies mostly exist because of highly paid techworkers that have more cash than they need.
I get laid off I'll just pick up my food myself, I'm not going to be ordering everything of Amazon, I'm cancelling all but my most active subscriptions.
There are a lot of positive feedbacks in the current tech ecosystem what will continue to be triggered and continue to bring down the massive, massive tech bubble we're in.
Most likely; these services will evolve into a format where it is financially more viable - which might even allow them to reach larger audiences.
Ideally, this should happen in a slow fashion (which it seems to be happening). A sudden crash would be more chaotic, but on the long term I doubt we have much to worry about as a sector; there'll still be plenty of jobs for tech workers.
They don’t sell tech. They use tech. They sell ads.
I do agree that the bull run for companies that sell tech will subside, maybe over correcting in the short term.