Super cool groovy neato post here at SFGate by Dan Fost and Ellen Lee, Chronicle Staff Writers, prophesing the next Google or MySpace. And let’s face it, who hasn’t spent many enjoyable hours debating and musing that very question hmmm? šŸ™‚

In the first quarter of this year, according to PricewaterhouseCoopers, 134 Web 2.0 companies received $869 million in venture funding, on pace to beat the $3 billion that 465 firms raked in last year. And that’s just the companies taking funding. Much of Web 2.0’s appeal is that engineers can start firms in their basements.

The article lists a bunch of companies “Under the Radar” that might make a billion dollar deal or two in the couple of years. Anyway, go have a read – I only knew three of ’em. Twitter, Meebo and Revver. You?

I’ve spoken before about my belief that the venture capital/angel investor market is in trouble. If someone has a good idea, a really good idea, current internet technologies and infrastructure have matured to the extent that a startup doesn’t need a bundle of money. A VC or AI needs to look very closely at why a simple clean workable solution can’t be funded by friends, family, the ex-boss or a house mortgage. Or even a credit card or two. And if VCs insist on only investing 5 million or above, they are gonna see some people inflating costs to meet the minimum. Which is what I rather naughtily recommended at Ben Barren’s presentation on gnoos.com.au (not to be confused with news.com.au, heh) at WebDirections 06. With a saucy smile he responded that it would take an entrepreneur a couple of hundred thousand to set up and the other 4 million plus for marketing. The cheek of it!!!! (I need to increase my marketing consultancy rates, doncha think?)

Anyway, that sort of money will just about pay the rent on the mandatory garage at Sydney prices. Garage in foto at top is Google’s old one, which the founders just purchased. You’d think they could afford a house by now! o.O

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