The valuation of Internet based and new-economy companies has been one of the most heated problems in financial markets over the past year. The problem is that Internet companies are riding a revolutionary wave and are not operating in the same environment as traditional old-economy companies. Naturally, using traditional means to valuate them is of limited value. Unfortunately, however, no accepted 'revolutionary' modes of evaluation have emerged to coincide with the broader growth of the e-commerce era. Investors must thus make their investment decisions on incomplete and unreliable data, focusing more on their own vision and projections rather than historical performance. This is a high-risk environment and investors should be clear that all may not be what it seems. Those who can handle this degree of risk should take comfort; those that cannot should stay away. 11 pgs. Bibliography lists 5 sources.
