A look at the recent happenings in tech industry and we see two recent acquisitions in the recent time. One is the takeover of Oculus by Facebook and the other is the acquisition of WhatsApp by the same social networking giant. The first one cost Facebook $2 billion and the second one $19 billion.
It’s quite interesting that tech giants are still interested in investing while many other sectors such as banking and real estate are going through a bleak period and are not attracting a large pool of investors.
What could be the reason behind the tech boom to continue even after so many years? One is the steady flow of communication all across the globe. The rapid growth of the hand-held device market and the need for cleantech solutions are two other reasons.
However, some analysts have been shedding skepticism as they fear the tech boom will result in another dot com bubble. How safe is it to invest in tech industry? Well, if investors is looking for exposure to new age technology, they will have to look to Silicon Valley.
That’s precisely because tech investments in recent time seem to be following a pattern. The giant companies such as Google and Facebook are acquiring promising startups. If a startup fails to have itself acquired like this, it calls for IPO once it makes a decent business. Two startups called GoPro and Box will have their IPO in this year.
The entrepreneurial economy of US is what is giving the country an edge over other countries. A British analyst called Ben Yearsley said, “We may have Silicon Roundabout but the US is the hub of world technology, with a highly entrepreneurial economy…”
Good news for investors from other countries is that they will not be completely left out because even UK investors can directly buy shares of NYSE listed companies. However, as one analyst pointed out, “there will be higher dealing costs and the inconvenience of dealing with dividends paid in dollars.”
Such problems might be there, but tech industry as an alternative route for investment can be relied. It seems to be safer than home buying or certificate to deposit. Companies such as Google which is 0.21% up from previous closing and Facebook up 0.47% seems good for the investors at this moment.