Considerations for Investing in the Technology Sector                                      traffic news

Considerations for Investing in the Technology Sector

The following information handles the theme of technology within the stock market investments, and responds to the question of whether, do technology and internet sector ensures success in investment?.

After months of speculation, Facebook will be tap public markets through an initial public offering of US $5.UU. millions of dollars, valuing the social media network between EE.UU. $75 billion dollars and the United States.UU. $100 billion (what is EE.)UU. (does$ 25 billion between friends?).

Once Facebook is made public, hundreds of millionaires of paper (and a few billionaires) will have the opportunity to take advantage of a day of payment most wildest imaginations of anyone when the company launched in 2005.

The late 1990s dot-com bubble (that became famous erupted in 2000) taught us that a business model that shows a way to actual income is a prerequisite for success online.

If those revenues must also include a path to sustainable benefits it is still a question unanswered left largely, especially judging by the financial results of the recent mega-companies, including listing of LinkedIn, Groupon, and Zynga.

We leave in the hands of equity analysts covering space technology to predict whether Facebook can thrive as Apple and Google. Instead, let's focus on how you can access the space of technical risk and what you need to know before you take the plunge.
Considerations for Investing in the

Everything is a matter of risk and reward.

Virtually all successful launch of companies follow what is known as the J curve. From the zero income and benefits, the J curve tells us that the first months or years of operations will be a negative return, since that money should be invested in research and development and achieve the business of land. Finally, the hard work and the deployment of resources fruit, and the curve moves to positive ground, after which continues (in theory) a pending upwards indefinitely.

Given that the founding investors are clearly taking the highest risk, which will invest in the lowest valuation of the company. As the funds of the J curve and start its northern climbing, new investors take fewer risks and, therefore, investing in increasingly higher valuations. If the company is successful, all investors generously benefit regardless of the stage they enter.
Considerations for Investing in the

The identification of the winners is very difficult.

What applications for iPhone or sites online to the retail become success stories has a lot to do with the good times and the whims of social media as the quality of the original idea.? While it is possible to design a strategy for explosive growth, the implementation of the strategy may also depend in a tweet of celebrities as a tactical ploy by sound.

Even the identification of winners in the middle of the flow is a challenge: think back to 2006, when MySpace was the platform of the future social media and Facebook was an annoying participant in the expansion space.

Diversify and outsource the analysis professionals.

Precisely because the winners are very difficult to identify, invest in a specific technology implementation underway as an individual investor brings with it a result almost at random. In addition to put all the eggs in a basket, are not able to negotiate the best conditions in the early stages of financing should do it alone.

With the limited amount of capital of risk willing to devote to this space, I have chosen to renounce direct investment in start-ups, but rather it relies on proven experience and the experience of Ryan Swagar Zeuner and Brandon, Venture51 technology venture capital fund managers.

Venture51 invests in numerous start-ups promising (in various stages of development) and helps its portfolio companies in the development and execution of their business plans. Investment in technology of risk through a Fund gives me diversity in holdings I need and the know-how I'm missing.

That no mistake: Tech risk investment is a risky business that involves a lot of strikeouts for a few double, triple, and if you're lucky, home runs.
Considerations for Investing in the 

The player all of us wants to buy a winning lottery ticket. If you have the chance to play the game as part of a fund managed by managers with experience rather than simply throwing arm in the slot machine, with a little luck, perhaps, be a salesman rather than a buyer listing the next technician.

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