Leader: Beware the Google IPO hype

You'd think it were 1999 the way excitement is building around the Google IPO. Earlier today, the price range for shares was set at a whopping $108 to $135, meaning it could be one of the biggest IPOs ever.

But is everyone - including Google, its backers and private investors - getting ahead of themselves?

A pair of recent tech offerings show the IPO waters aren't that great right now.

Virgin Mobile had to cut its share price before trading started due to the dreaded 'lack of enthusiasm' from investors. Shares are now worth around 190p, below its opening price of 200p on the London Stock Exchange last week. The company had hoped to IPO in the 235p to 285p range.

Over on the New York Stock Exchange, Salesforce.com shares have also fallen below their IPO price of $15, and are trading around $13.

Add to these the fact that the Nasdaq, on which Google shares will debut, has been pretty lacklustre of late. It's fallen steadily from its recent peak of 2,020, reached on 23 June, and is hanging around in the 1,850s as of Friday's close. There's even talk of 'dead cat bounce' or possible 'triple waterfall' on the Nasdaq - which translates as continued weakness.

No doubt, Google's IPO will see plenty of interest. The question is whether it can be sustained over the long or even medium term.

The auction style of Google's IPO means that while the company will set the opening price range, investors will bid to determine the actual IPO price. Given the limited amount of shares available, investors may push the price quite high to ensure they receive shares.

But how long will that enthusiasm last?

If recent IPOs - or even the big IPOs of the 1990s - are any indication, not long.

Though Google stands to make a load of cash off the deal regardless, investors should be wary. If there's anything we should have learned from the dot-com crash, it's that the more hype around an offering, the more careful you should be.