Facebook, the social-networking giant , has debuted on Wall Street - and dragged Silicon Valley with it into the next technology boom. But there are fears that the firm's listing on the Nasdaq yesterday may flounder following a decline in the US economy over March and April. Any significant fall in the company's post-IPO performance could quickly result in Facebook dragging the technology sector from boom to bust.
"The IPO has the potential to be the blockbuster of online company listings and could make Google's 2004 stock market debut, at US$1.9 billion [Dh6.98bn], with a valuation of US$23 billion, look modest by comparison," says Eden Zoller, an analyst at Ovum, the research firm.
In the run-up to Facebook's initial public offering (IPO) , investors were showing interest in any company that fell under a broad definition of "social networking" in the hope that one will magically turn out to be "the next Facebook".
One example is Pinterest, the social photo-sharing website that largely appeals to women shoppers. It is now being widely tipped as the next big IPO after Facebook, with an estimated value of $200bn. Social travel sites are also attracting massive interest, with Facebook  users starting to access them to book free accommodation with their online "friends". Most of these sites are based in Silicon Valley and include CouchSurfing and Twigmore. But Rob Enderle, the principal analyst at Enderle Group in San Jose, California, says investor appetite for social-networking companies is reaching a level reminiscent of the dot-com boom years. Silicon Valley property agents have also been reporting rent rises of 40 per cent.
"I doubt Silicon Valley can do anything about this," Mr Enderle says. "This is an investor-driven event and the feeding frenzy is largely fuelled by Facebook."
There is concern that the social-networking goldmine may turn out to be little more than a seam of fool's gold. In the first three months of this year, Facebook's earnings dropped to $205 million, from $233m for the same period last year. However, in the same period, the company's revenues rose to more than $1bn. By contrast, Microsoft is valued at almost $270bn, but had earnings of more than $5bn, roughly 25 times that of Facebook, making the social-networking site's valuation of $104bn, after it priced its offering at $38 a share  on Thursday, look very high.
Some Silicon Valley sceptics are also concerned about the social-gaming site Zynga's relatively poor performance since its much-heralded IPO at the end of last year. Only three months after going public, Zynga began to lose money. In the first three months of this year, the company suffered a net loss of $84.5m, as opposed to a profit of $168m for the same period last year, when it was still a private company.
"Looking at Zynga's performance in the market ... it almost looks like general investors are starting to lose their taste for social-networking properties," Mr Enderle says.
It could be that some of the investors losing their enthusiasm for Zynga have opted to look beyond the IPO to see what the company actually sells. Zynga relies heavily on sales of virtual items, effectively on-screen cartoons. These are used to play online games such as FarmVille, CityVille, Mafia Wars and Words With Friends. Committed players pay real money to download "virtual" tractors at $10 a pop. These sales accounted for most of Zynga's $1.1bn revenues last year.
The sale of virtual images such as these to adult gamers would have a shaky long-term future in a prolonged recession. History also shows that competition on the internet is only a click away and that there is always a new online company offering something that looks shinier and newer for free. But what may concern some investors more than the ephemerality of Zynga's virtual product line is its close association with Facebook, which acts as Zynga's distributor. Some social travel sites also rely heavily on their connection with Facebook to attract new customers.
As investors in the US are allowed to "grey" trade private shares in companies that are not yet ready for an IPO, many had already invested not only in Facebook, but in other fledgling social-networking websites. Some of these are bound to fail should Facebook's fortunes fade.
Many recall the dot-com boom and bust of more than a decade ago. There are fears that relying on a single website to generate a tech boom may prove to be over-optimistic.
"Facebook could ... at the very least, take a stronger control of its image," Mr Enderle says. "The image of a firm with sliding financials run by an out-of-control kid who got too much money too fast isn't exactly the image of a $100 billion [plus] company, yet that is the one the firm appears to be building."
If anything, Facebook's chief executive, Mark Zuckerberg, seems determined to confound his critics, even right up to the company's listing, as evidenced by his decision to buy Instagram, the photo-sharing website, for $1bn. But some industry watchers remain impressed by Facebook's meteoric rise and the loyalty of its 901 million customers. The momentum behind Facebook's listing has become virtually unstoppable. However, too many investors are now gambling on making a quick killing shortly after listing rather than planning on holding Facebook stock as a long-term asset.