The internet era reached a pinnacle in 1997 and continued till 2000, which was fueled by the accelerating Information Technology (IT) industry. To cash in on huge profits, entrepreneurs invested in any sort of dot-com businesses by simply adding an “e” prefix or “.com” to their names. They aimed at a ‘growth over profit’ policy, assuming that once they built their customer base, their profits would swell creating the dot-com bubble. Their goal was to “get big fast” and instead of working towards creating a plausible business plan, they increased the stock prices. The value of the equity markets increased exponentially as investors made huge investments largely on the basis of inflated stock prices.
However, the growth of the tech companies proved to be illusionary and many legal cases were filed against them for practicing unscrupulous business ethics. The stock market slumped when the verdicts went against these companies. Unable to bear the financial losses, many companies declared bankruptcy – Pets.com, Broadband Sports, Boo.com, eToys.com, Read more