That sound you hear? The new internet boom

NEW YORK — The tantalizing prospect of finding the straightway Facebook, Groupon or Twitter is driving the biggest rush of venture capital into the Internet start-up arena since dot-com mania first boomed and at the time fizzled more than a decade ago.

The boom years

Though small compared with the boom years, the sum puts 2011 on track to be the busiest in dollar terms since 2000, when more than $55 billion was deployed to back nascent research firms.

Herd investment behavior gives rise to talk that another Internet bubble is forming, particularly when analysts see valuations on the order of $70 billion for Facebook and $15 billion for Groupon calculated from private investments.

Moreover, it is the big deals that as often as not are now happening outside of the United States. Of the 25 biggest consumer Internet deals last year, 15 were non-U.S. investments, according to Quid, a Silicon Valley innovation start-up that tracks VC investment flows. Near half, 12, were Chinese.

While one of the distinguishing characteristics of the new boom is the tendency to remain private for a longer period, the IPO pipeline is however filling up with Internet names.