1- The term dot.com

The term Dot COM (English .com) appeared before the explosion of bubble Internet to indicate, the madness which seized the “entreprenautes” to the evocation of three sesames of the E-trade: market, customers and Internet. A synonym of E-business.

2- The Internet Bubble

The "dot-com bubble" sometimes referred to as the "I.T. bubble" was a speculative bubble covering roughly 1995–2001 with its peak on March 10, 2000 with the NASDAQ peaking at 5132.52 during which stock markets in Western countries saw their value increase rapidly from growth in the new Internet sector and related fields.
The period was marked by the founding and, in many cases, spectacular failure of a group of new Internet-based companies commonly referred to as dot-coms. A combination of rapidly increasing stock prices, individual speculation in stocks, and widely available venture capital created an exuberant environment in which many of these businesses dismissed standard business models, focusing on increasing market share at the expense of the bottom line.

3- The growth of the dot.com bubble

The venture capitalists saw record-setting rises in stock valuations of dot-com companies, and therefore moved faster and with less caution than usual, choosing to mitigate the risk by starting many contenders and letting the market decide which would succeed. The low interest rates in 1998–99 helped increase the start-up capital amounts.
A canonical "dot-com" company's business model relied on harnessing network effects by operating at a sustained net loss to build market share. These companies expected that they could build enough brand awareness to charge profitable rates for their services later. The motto "get big fast" reflected this strategy. During the loss period the companies relied on venture capital and especially initial public offerings of stock to pay their expenses.

4- Soaring stocks

In financial markets a stock market bubble is a self-perpetuating rise or boom in the share prices of stocks of a particular industry. The term may be used with certainty only in retrospect when share prices have since crashed. A bubble occurs when speculators note the fast increase in value and decide to buy in anticipation of further rises, rather than because the shares are undervalued. Typically many companies thus become grossly overvalued. When the bubble "bursts," the share prices fall dramatically, and many companies go out of business.
Financial means the very important ones are placed at the disposal of the company founders who do not require almost any more any contribution to see the day so much the profits promised by the companies of the sector sharpen the appetite of the investors. The courses thus reach impressive proportions without relationship with the turnover or the real benefit.

5- Burst of the dot.com bubble

At the height of the boom, it was possible for a promising dot-com to make an initial public offering (IPO) of its stock and raise a substantial amount of money even though it had never made a profit — or, in some cases, earned any revenue whatsoever.
The dot-com bubble burst on March 10, 2000, when the technology heavy NASDAQ Composite index peaked at 5,048.62
The massive initial batch of sell orders processed on Monday, March 13 triggered a chain reaction of selling that fed on itself as investors, funds, and institutions liquidated positions. In just six days the NASDAQ had lost nearly nine percent, falling from roughly 5,050 on March 10 to 4,580 on March 15.
By 2001 the bubble was deflating at full speed. A majority of the dot-coms ceased trading after burning through their venture capital, many having never made a net profit. Investors often jokingly referred to these failed dot-coms as either "dot-bombs" or "dot-compost".

6- Consequences

Everybody wants to sell and we assist to the decline of title from the Stock Exchange strongly concentrated in the sector.
The bankruptcies are connected and the sector will know a terrible recession, extending to the worldwide economy in general. Thousands of start-up are resold with depreciations, with the image of Selftrade, start-up promising created in 1997 per Charles Beigbeder, and resold in Boursorama in December 2002 per 62 million euros, that is to say ten times less than its value three years earlier. Several hundreds of thousands of employment are destroyed. Several hundreds of thousands of employment are destroyed. With them the confidence of the small shareholders in the stock exchange speculation.