The dot-com bubble refers to a stock market bubble that caused a lot of problems when it finally burst in 2001. The dot-com bubble was primarily fed by the explosive growth and popularity of internet web sites and various companies involved in the tech industry. Many companies eventually went under when the bubble burst while other learned many valuable lessons about how to run a company. A substantial number of investors lost a lot of money when the dot-com bubble burst that eventually lead to a small economic recession that occurred in the early 2000s.
There were a number of factors that contributed to the dot-com bubble – which generally describes the period of time when investment and speculation on different internet firms happen. This period is generally viewed as covering the years from 1995 to 2001. The year 1995 was remarkable in that it was the year when tremendous growths in the number of internet users began to happen. Because of the potential number of new consumers, many internet companies began to pop up to take advantage of this new opportunity. These companies were also refered to as dot-com’s, which was term based on the .com domain that many web addresses have.
But the explosive growth of internet companies was nothing more than just a short lived fad. Many companies were not able to sustain this growth and folded up or declared bankruptcy. This was particularly concentrated in areas like Silicon Valley, which was an area where many dot-coms established offices.