Helping individuals to make money is the next big trend for investing in online companies, according to one of the early investors in TweetDeck.
After online voucher company Groupon became the latest tech start-up to file for IPO last week, investors are looking for the next trend to buy into online.
“The next round for the internet is companies that enable individuals to make money, either through the assets that they own or their reputation," Rogan Angelini-Hurll, founding general Partner at venture capital fund PROfounders Capital told CNBC Tuesday.
"It’s [currently] all about companies making money, and now there are going to be opportunities for individuals to make money via the internet. So it’s kind of an extension of eBay power traders.”
Airbnb, which allows users to profit by renting out rooms - or their entire houses or apartments - on a short term basis, has recently stolen the start-up limelight. And similar websites which allow you to rent out your car, tutoring skills or office space are also gaining attention.
Angelini-Hurll was an investor in TweetDeck, which was bought out by Twitter last month for 25 million pounds ($41 million).
“We invested as a second round investor in late 2009,” he told CNBC. “At the time it had about 2 million downloads. It’s grown very steadily, the chief executive is a very good CEO who built the product because he likes it. Since then it’s had over 20 million downloads.”
But, despite the underperformance of LinkedIn shares since its initial public offering in May, which led some to talk about a new dotcom bubble, he does not seem to be worried about a 2.0 dot com bubble forming.
“If we look at the larger companies there is a lot of heat in the market," he said. People are talking bubble. My personal view is this is different this time. They are proper businesses, they make proper money. When Google went out in 2004 everyone thought that was a very expensive deal at $23 billion market cap with only $100 million of profit. Now it’s a $170 billion market cap company.”
“The problem if you are an analyst or investor is, fast growing companies are very difficult to value. Groupon has revealed large losses and that’s all marketing spend for the future. People will work out how comfortable they are with a per user valuation – that’s how I would do it – but these things have to grow into their valuation otherwise there will be another bubble,” he said.