The earlier bust had a lot of fluff bursting from the bubble, but there were solid, growing companies as well. GoTo (later Overture, then a Yahoo purchase) was

The earlier bust had a lot of fluff bursting from the bubble, but there were solid, growing companies as well. GoTo (later Overture, then a Yahoo purchase) was ramping up its pay-per-click ad model and several brick and mortar companies were still trying to gain a presence on the web, and were willing to pay for it. Google launched Adwords in October of 2000 and its growth since then needs no recap. Basically nascent companies that were ideas sans business plan fell by the way side, but there was still active investments being made and a growing ecosystem online. A lot of capital shifted into that ecosystem--track newspaper closures with Adwords' growth. Valuations took the biggest hit, but the work didn't.