Mixed signals in the Bubbleconomy

Its business as usual on BubbleWatch, as AOL/TechCrunch's Michael Arrington starts a startup fund:

Mr. Arrington is starting a venture capital fund to invest in the start-ups that TechCrunch covers.

The $20 million CrunchFund is financed by AOL, Mr. Arrington’s employer, and by many of the top firms in venture capital — including Sequoia Capital, Kleiner Perkins Caufield & Byers and Greylock Partners — which Mr. Arrington also covers on TechCrunch.

Nothing like a conflict of interest there......but so far, so predictably bubbly (In fact he's a bit late to the startup fund party, see our Bubble-O-Meter above - but the more the merrier in Bubbletimes)

And yet, there is also this interesting aberration - Analysts are calling Groupon overvalued, the bounders - PE Hub:

In one of the nicer reports to be published about the daily deals company in recent weeks, Benchmark Co. analyst Fred Moran told Reuters that he considers the company’s oft-cited valuation of $25 billion “very high.”

This morning Henry Blodget of Business Insider jumped into the fray, defending Groupon from the many slings and arrows it’s been taking by writing that the company “can make money – but it won’t be easy.”

Well, that's Henry for you, ever the optimist...but it is interesting that a DotCom II darling is actually being called OverValued. Sarah Lacy thinks its because essentially they Werent Invented In the Valley. I think its because they are overvalued.

What will be interesting is to see if this new crop of analysts have a pop at some other overvalued IPO's in waiting......We have a sniff that step 6 is starting, but Step 7 in the Bubble-O-Meter may be delayed a bit!