Kevin Hartz has his fingers in a lot of pies. He was an early backer of some of the biggest names in technology and the Web, including Pinterest, Flixter, PayPal and several other well-known developments.
Now though, he's not investing in anything relating to Silicon Valley, partly because it's too expensive and partly because he sees the end coming.
"We don't know where we are in this cycle," Hartz says of his investment plans. "We can't know how much longer this abundance of capital will last, but I don't want to be a part of it. When I see a massive number of new investors and carpetbaggers coming in, it's time to get out."
While he wouldn't term the current situation a bubble, it certainly does hark back to the days of the first dotcom boom. New startups being bought for huge sums of money, over inflated stock prices and everyone trying to jump on the bandwagon of the latest money making scheme. Facebook was a big contributor to this latest wave and is still riding it, but image firms like Instagram are right there with it.
"Everyone is competing for the same people, going after the same real estate, the same support services," Hartz says. "The natural resources of the startup world are getting scarcer and scarcer, and the cost is getting higher and higher. It's all an outgrowth of an abundance of capital."
If now isn't a time to invest though, when everything is up, when does Hartz consider it the right time? When it's down of course.
"When things are most dire, and people are most scared," Hartz says. "When people openly mock the consumer internet space and the excesses of it, that's when I will start investing again."
Image credit: Forbes