CHART OF THE DAY: Why Ben Horowitz Thinks Tech Valuations Are Ready To Explode

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The valuations of internet-based companies have significant room for growth in the next decade, argues venture capitalist Ben Horowitz for the Economist.

To understand why, Horowitz produced the three charts below. As you can see, the “Internet Cycle” is due for a massive explosion in the next 10 years based on historical trends. 

He says that major technology cycles generally last 25 years, with the “bulk of the purchases” happening the last 5-10 years as late adopters sign on. Using this as a frame of reference he says we are “poised to hit the major adoption wave for the Internet technology platform over the next 8 years.”

This isn’t just idle chatter from Horowitz, either. His VC firm Andreessen Horowitz raised almost $1 billion to invest in this next wave.

chart of the day, tech valuations, june 2011

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