A decade on from the dot com bust, Notion Capital’s Jos White says the big difference has been that the current generation of internet companies not only have huge user-bases, they also know how to create revenue.

There are some giant numbers being thrown around, but the big difference is that the current generation of internet companies not only have huge user-bases, they also know how to create revenue. Jos White, co-founder of Notion Capital, explains.

There is no doubt that the last ten years have been a tumultuous time for businesses, starting with the dot com crash before moving on to a period of enormous growth, but finishing with the credit crunch and the worst financial crisis for decades.

The dust hasn’t quite settled yet and there is a rocky road ahead but the new opportunities available make it a very exciting time for someone thinking about starting a business. The past decade has produced a number of casualties, both large and small, but there have also been a great number of success stories too.

There are similarities between 2001 and 2011, especially with online technology companies attracting large valuations. However, I don’t believe that this is a bubble along the same lines. There are some giant numbers being thrown around, but the big difference is that the current generation of internet companies not only have huge user-bases, they also know how to convert users into significant revenues and, to a lesser extent, profits.

For example, LinkedIn is expected to generate around $500million in revenues this year, Skype is forecasting over $1billion, Salesforce $2billion and Facebook more than $4billion. These companies are all still growing too. It’s a stark contrast to 2001 when internet businesses did not have such large user-bases and lacked profitable business plans.

LinkedIn and others will have a bumpy ride and their value is probably inflated at the moment but this is more down to scarcity in the public markets than anything else. These companies are here to stay and they are a part of a generational change in the world of technology.

Businesses and entrepreneurs have learnt a great deal over the last ten years, taking on board lessons learned from mistakes made in the dot com bubble and developing a greater understanding of how new technologies and opportunities can be turned to profit.

From a financial perspective the business world has moved on dramatically. In the last decade we have seen huge amounts of free-flowing credit and stock markets rise to towering heights before crashing down as the credit dried up.

There is still a lingering issue with access to credit for small businesses, with 28 per cent of small businesses being turned down for a loan in 2010, compared with just four per cent in 2007. The number of venture capital firms has also dropped significantly too. According to the European Venture Capital Association, the number of funds dropped from 1,600 in 1999 to 596 in 2009 and, out of those remaining funds, only 30 per cent are considered to be active.

While the available funding and avenues of funding for small businesses have both fallen, we have seen the rise of what is being heralded as the ‘age of the entrepreneur’ at the same time.

Recent figures from Companies House appear to back this up, showing that 396,000 companies were created in the 2010/2011 financial year – almost 10 per cent more than the previous year and the highest since the financial crisis began.

Whether or not this is down to TV programmes like The Apprentice or Dragon’s Den exposing more people to the idea of starting up for themselves or if redundancies from the financial crisis have revealed a new group of latent entrepreneurs is a matter for debate.

One thing is for sure, being an entrepreneur has become a much more aspirational goal and more people are giving it a go than have done for years. The UK is quickly becoming the centre of a thriving European start-up ecosystem and with fantastic new opportunities available there has never been a better time to start a business.

White is a serial entrepreneur having founded four businesses including MessageLabs and, most recently, Notion Capital, a VC focused on Internet-based businesses.