Some analysts and investors see a bright spot in technology even though the S&P tech sector is down about 12 percent year to date.
Angel investor and Inside.com CEO Jason Calacanis told CNBCs "Squawk Alley" on Tuesday that this is the "punishment phase" for start-ups and that professional management is being brought in to wrangle the industry.
"We're going to see a lot of changes at the top of companies and obviously valuations from the private sector up to the public markets have been corrected," said Calacanis.
"The public markets have gotten off easy compared to what I see in the private markets, where we're seeing valuations get cut in half, sometimes by about two-thirds," he added.
Tech investor Paul Meeks to told CNBC's "Fast Money Halftime Report" on Tuesday that the recent carnage in the tech sector has produced a lot opportunities for bottom fishing.
"Amazon, out of the FANG names, might be the best opportunity because I am absolutely stunned in a positive way with the success of Amazon Web Services," said Meeks.
"I think if you bought them today, you'd probably be very happy a year from today," he said.
Meeks, who managed Merrill Lynch's Internet strategies fund during the dot-com bubble, said that there are major differences between this environment and that bubble.
"When you see the deterioration in the price of Tableau, of Amazon, of Microsoft, of LinkedIn ... these are companies that I know for sure are going to be longstanding and will do quite well," explained Meeks.
Red Hat CFO Frank Calderoni told "Squawk Alley" on Tuesday that despite the pessimism in the market, companies need to focus on long-term growth and keeping their customers happy.
"The key thing for us, and most companies really, is to focus on the fundamentals ... and really what your customers are looking for and making sure you're meeting those requirements," said Calderoni, who is also a member of CNBC's CFO council.
For investors looking to get into private start-ups, this isn't necessarily a bad thing. Calacanis said that a couple of years ago, start-ups were aiming for $10 million to $15 million valuations.
"In the fall, it was $7 to $10 million and now, yum, yum, we're back down to $4 to $5 million valuations and that's where I make my money," Calacanis said.
"I'm going to invest in more companies this year than I did last year," he added.