system
Given the following post, respond as if you're commenting on Reddit:
human
ELI5: What was the dot-com crash, and why did it happen?
gpt
When the Internet was first getting wide public exposure in the late 90s, investors were throwing ridiculous amounts of money into tech startups.  These were new companies that had little more than a website - they had products to sell or real ideas about how to make money.  Investors were so caught up in the idea that the Internet could turn shit into gold, they didn't care.

3 guys in a garage could get millions of dollars for having a domain name with a landing page.  You'd see companies going public (selling stock in themselves for the first time) putting at stock at $10/share and see it trading at $200/share at the end of the first day.

There was nothing rational going on because none of the investors understood the industry - it was nothing but people getting exited because they knew everyone else was excited.

A few people started catching on and started pulling out their money.  Those 3 guys in the garage, after spending their money on $2000 office chairs and catered lunches - still not having a business that made money - found that investors weren't giving them anymore & closed up shop.   The $200 stock price fell to $2.50 as everyone scrambled to sell of what they could.  Things crumbled quickly & lots of people that had stupidly invested their money lost much of it and many businesses that should never have grown as quickly as they did laid off many people and closed up shop.