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Are you afraid of missing out on the next big thing? Afraid of being left standing on the platform when the train departs?

Gold fever has gripped people throughout history. In 1848, 300,000 people flocked to California because GOLD had been found at Sutter’s Mill. Thousands of startups were created when the Internet became the new gold vein. Cryptocurrency creates winners and losers every day with huge price swings.

Gold rushes can be recognized by a number of elements:

• Extreme hype and optimism
• A low barrier to entry in the beginning
• High risk, few winners
• Infrastructure and services rapidly emerging around them
• Many people quickly flocking to exploit the phenomenon
• The possibility of quick riches driving behavior

The psychology is driven by FOMO. “My cousin found gold in California.” “My colleague bought Bitcoin for 100 kroner and became a millionaire.” It creates the feeling that you are missing out on an obvious opportunity if you do not jump on the bandwagon right now.

But we only hear the good stories. The people who find gold nuggets, the startups that are sold for billions, and the crypto bros who got rich. We rarely hear about the vast majority who lost the game.

It feels safe to do what everyone else is doing. Herd mentality can drive us. At the same time, we overestimate our own abilities. Surely we are even better at finding the gold or spotting the gap in the market.

The typical “gold rush cycle”:

1. Discovery / innovation
2. Early winners
3. Hype and mass entry
4. Overinvestment / speculation
5. Crash or consolidation
6. A few strong companies survive

The truth is that it is rarely the masses who make money in a gold rush. It is the people selling work clothes and shovels to the gold diggers. The people running the bar where the gold diggers relax after a hard day’s work, and the people operating the only hotel in the gold mining town. Infrastructure, platforms, and tools.

And then there is the economy after the gold rush is over. The people who bought up failed startups during the dot-com bubble and made good acqui-hires. The people who bought equipment back from gold diggers who gave up, paying only a fraction of its value. The people who picked up new technology or patents cheaply when startups ran out of investor money.

After the dot-com bubble, there were enormous amounts of cheap fiber internet, data centers, and software expertise available – for those who still had their money intact, or had not lost more than they could afford.

A few winners, and many losers.