A lot of this M&A frenzy was financed by debt. Consequently, the balance sheets of many companies deteriorated rapidly. Doubts, if the exuberant profit expectations would be fulfilled, and concerns about company leverage initiated the decline in equity markets. The bubble burst when investors realized that they were not compensated for the downside risks associated with investing in overvaluated tech companies. When a few of the TMT newcomers began to struggle, investors had to acknowledge that there was no free money to be made in TMT IPOs. Highly leveraged balance sheets caused serious problems for some of the brightest stars of the equity hype, and for some of the big companies. Actually much of the equity bubble was concentrated on large cap companies.