Silicon Valley's Overstuffed Startups

This was supposed to be the year Silicon Valley's financial plumbing started to unclog. That prediction hasn't panned out, and it's becoming harder to see a way to avoid a messy blowout.

Here's what's happening: Young tech companies have been backed by unprecedented sums of investment money in the last three or four years. Those startup financiers in turn have collected record amounts of money from their own investors to buy pieces of future tech startups. All this money is going into the startup system, but it's not coming out the other end.