Last night I and my AJoMT associates, Andrew and Nathalia, hosted another music-and-tech meet-up in Toronto. The place was jammed and the waiting list was a mile long. Interest in the area where music and technology intersects has never been greater. That’s fantastic, right? Or are we seeing a music-and-tech bubble? I mean, look at the stock market so far this year. It’s been…well, it’s been awful.
The stock market is faltering. The heavy flow of venture capital funding constricted sharply in the fourth quarter. Some high-flying technology companies, bloated with easy money, are starting to fall back to earth. The coming hangover might affect some digital music companies, but experts say not all valuations are suspect and that good ideas will continue to find financial backers.
What could be more emblematic of a bubble than overvalued technology companies? Turn to any technology blog or financial outlet and you’ll see talk about “unicorns,” those private technology companies with valuations over $1 billion made possible by easy access to money. Fortune‘s “The Year In Unicorns” recounted 12 months of warnings and irrational exuberance. The Economist warned of a coming“techquake” for the 150 unicorns currently on the planet (according to CB Insights). Prominent venture capitalist Bill Gurley spent 2015 predicting imminent doom for highly valued technology companies that lack financial fundamentals.