As we near the end of 2009 we can look back on the events as we continued through a difficult recession. Comparing this year to the dot-com bust of 2001-2005 shows us some interesting tings in retrospect.

Early 2000’s saw 185,000 jobs lost in Silicon Valley alone and billions of venture capital investment money disappear in the shake-out of companies like and Webvan. is an interesting case-study for the .com bust — Having ceased operations in 2000 after additional funding rounds and the outright sale of the company both failed. laid off over 300 people and its stock dropped from a high of $11 a share at its IPO to $.23 cents 9 months later.

The problems that are thought to have affected include over-discounting of products to attract customers, the expense of delivering bulky pet supplies, such as cans of dog food, and the company’s failure to sell sufficient higher-margin products such as pet toys. The company had 570,000 customers, but that figure was considered too low to reach profitability in a market where profit margins are narrow.

In 2009, many industries outside of tech have been affected by the “bust”, and the Valley once again is also experiencing job loss and business failure. This time around fewer businesses, are failing showing a learning curve from the spending habits of tech companies of years past. I will save my comments on the specifics for this learning curve for a later post.

Side-note: It should be added that most expect the worst is not over in the recession. I think this because budgets of 2009 are based on sales of 2008, before the recession really took hold. Now, in 2010, budgets will be set on 2009 earnings and will certainly lead to lower expenditures. Some budgets could lower sales and lead to downslide of organizations. So while this assessment is currently accurate, a chapter will need to be added next year (maybe a book) and it could possibly tell a different story.