A steady influx of funding from angel investors and venture capital firms that are hoping to find the next LinkedIn spacer or Facebook has sparked a potentially dangerous financing frenzy for the technology-startup industry, according to investors and market participants. And the recent market turmoil has done little to slow the stampede.
London-based hedge fund Derwent Capital Markets, dubbed “The Twitter Fund” because it uses tweets to help it predict market activity, turned in positive returns in its first official month of trading.
“Insider buying has accelerated dramatically to its highest level since the market bottom of March 2009,” according to Ben Silverman, Director of Research at InsiderScore, a firm that tracks buying and selling activity for corporate insiders.
On the heels of LinkedIn’s successful initial public offering, many of Silicon Valley’s biggest investors are throwing millions in seed capital at a handful of startups looking to cash in on something called “crowd commerce,” where everything and everyone has a price.
Airlines fight a constant battle with fuel price volatility. Since the industry spends about a third of its operating costs on fuel alone, airlines employ an arsenal of financial instruments like derivatives, options, and caps, to hedge against wild swings in the energy market.