Technology funds have been all the rage of late, with banks tossing money into them with an enthusiasm last seen during the dot-com boom. Many investors are looking to get a piece of the start-up pie, hoping to strike gold with the next Facebook of Groupon. Unfortunately, not every start-up is going to see success and some venture capitalists worry that eager banks are not editing carefully enough in the projects they invest in.

All of the recent attention has led valuations to soar. Investment in Facebook and Zynga, the company that creates online games like Farmville and Mafia Wars, had led the implied values of the corporation to increase by a factor of five in only two years. This may not seem like a problem now, but like with the dot-com boom at the turn of the century, all that exuberance could backfire.

Still, there are significant differences between now and then. For instance, according to a CNN article, there were around 308 I.P.O’s during the dot-com bomb, whereas today, there are only around 20 companies attracting attention. This means two things: there are fewer options and seriously higher influx of capital being infused in them.

The amount of money Wall Street banks, hedge funds, venture capitalists and private equity firms are putting into web start-ups is a cause of concern for many investors. The reason being, a lot of these companies have more money than they need to operate. With everyone clamoring to get a piece, companies are becoming over-valued. Venture capitalists alone are raising dollar amounts in the billions and putting all their eggs in one basket. Accel Partners, a Facebook investor is preparing to gather $2 billion for investments in China and the United States. A handful of other firms have raised similar dollar amounts. The question remains though, with fewer places to spread it around, and staggering capital being raised, is there a way that the money can be responsibly exercised in a way that increases the actual value of the company to the same levels as the valuation?