It is 1999. A man in a fleece vest is standing on a stage in San Francisco, holding a laser pointer aimed at a PowerPoint slide that reads: "Pets.com: The Future of Pet Ownership." The audience is nodding. Venture capitalists are already reaching for their chequebooks. Nobody has asked how the company will make money. That question, frankly, is a bit gauche.

We 'bout ta bubble, baby. Get ya waterproof vest.

The Richter Scales saw it coming in 2007 when they wrote their now-legendary parody song warning that Web 2.0 was inflating like a rubber duck in a bathtub. They were right, of course as right as anyone who says "this cannot possibly last" always eventually is. But in the dot-com era, the original bubble, the Platonic ideal of financial absurdity, the bubble against which all future bubbles are measured, nobody was listening to the cautious voices. The cautious voices were not invited to the foam parties.

Peter Thiel was there for all of it. He watched PayPal survive the wreckage, then sat down years later to write Zero to One, his meditation on startups, monopoly, and the peculiar madness of Silicon Valley. In the book he describes the dot-com crash with the clinical detachment of a man who made it out alive: the lesson entrepreneurs drew from the carnage was to be lean, scrappy, and humble. No grand visions. No world domination. No more mascots with sock puppets.

Thiel thought this was entirely the wrong lesson.

He was probably right, but let us not get ahead of ourselves. First, the bubble.