In the dot.com bubble, it felt to me like the opposite was taking place: a lot of very rich people pumped a lot of money into startups, some of it in turn transferred to engineers and other employees and from that into, say, restaurant tips.
I was living in Tel Aviv at the time and you could almost taste the sudden influx of wealth into the city's economy.
A bubble isn't bad, if you're careful not to buy into it. It's a great time to launch or upgrade a career, and acquire skills, contacts and even savings that will last you a long time, especially through the inevitable bust.
Sure, it feels great when it's in bubble phase, which is kind of the whole point.
I was in Ireland just before the last bust and all my cousins and aunts would be dispensing pearls of wisdom such as "you never lose on the housing market in Ireland", and "My house is worth 700K. I'm RICH!".
Bubbles are by definition Ponzi schemes, and when they bust someone is going to be left carrying the can. That's usually people who a) Had some money beforehand (or are now massively in debt) and b) aren't the most astute investors.
I'm not, by any means, suggesting bubbles are a good thing. I'm saying they're a fact of life in this field, so people working in startups should know how to deal with them.
If you can maintain a level head in a bubble (ie, the opposite of the approach you heard in Ireland - and I often heard in Tel Aviv) you can survive it, and even gain from it. I'm talking about the startup engineer case, I don't know anything about the investor's case.
I was living in Tel Aviv at the time and you could almost taste the sudden influx of wealth into the city's economy.
A bubble isn't bad, if you're careful not to buy into it. It's a great time to launch or upgrade a career, and acquire skills, contacts and even savings that will last you a long time, especially through the inevitable bust.