The web's about creating vast wealth for the few, not jobs for the many Facebook is paying partly in its own stock, which many would judge to be hugely overvalued - Facebook is shortly due to IPO at a value of up to $96bn - so this may only be a question of one overvalued currency paying for another. It's also a highly defensive deal, designed in part to head off the possibility of Instagram going off and developing a rival social network based on smart phones, where Facebook is weak. There is no way of putting a value on such acquisitions. It's as much about acquiring the people as the company, so that they are removed as a potential competitive threat and must work for you instead. Such deals may be the exception, rather than the rule. What is more, for every company that hits the jackpot, there are thousands that fall by the wayside. None the less, there's definitely something new going on here. Apple recently paid $4bn for a set of patents from Nortel and Facebook $500m for intellectual property from AOL. Is this another technology bubble in the making, or does something rather more substantial than the tulip mania of the last dot.com gold rush lie behind it this time around? One person who is convinced it is more of the latter than the former is Victor Basta, managing director of Magister Advisors, a boutique M&A advisor in the technology field. "The age of the near zero-employee, $1bn company, is here," he proclaims, and he predicts a lot more Instragram-type deals over the months and years ahead. New records are being set all the time. Facebook's acquisition of Instragram translates into a value per employee of $77m. Facebook's IPO filing implies a value of $33m each, while Twitter and Apple are worth around $10m per employee. Microsoft, now the ageing dinosaur of the technology world, is by contrast worth only $3m each. The valuations are backed by a degree of revenue acceleration, real or potential, which has never before been possible in the business world. It took Microsoft three years to go from zero to revenues of $1m. Over the same timeframe, Mr Basta points out, Facebook went from zero to $150m. The near-free distribution channel and viral-marketing powers of the internet allow a speed of business development quite without precedent in the history of commerce. The redefining feature is that very little in the way of traditional business infrastructure, which can take years to develop and is usually extraordinarily costly, is needed to support these modern day companies. Is it right to call such companies businesses at all? Many would seem to have more in common with best-selling authors such as JK Rowling than the usual attributes of a business - production, distribution and delivery. And what do they mean for the future of employment? The internet seems to be more about creating wealth for the few than jobs for the many. Still, there is one big positive that stems from these new forms of wealth creation; many of those that hit the big time tend to recycle large parts of their good fortune back into new start-ups, creating a virtuous cycle of company formation. Part of the upside for society of those who make vast amounts of wealth while still very young is that they tend to reinvest it. Where once the fruits of exceptional wealth creation would be ploughed into the charitable foundation, it now heads for venture capital. This is already an established phenomenon in Silicon Valley. Generous tax breaks are helping to encourage the same venturing in the UK, too, examples being PROfounders and Atomico, both part-financed by money made from previous start-ups. In any case, if you want to get rich quick, don't bother with hedge funds; write code.