3 Industries In A Bubble That Aren't Technology

Mark Cuban thinks that the current (speculated) tech bubble is worse than the one that destroyed dot-com startups more than a decade ago.

Not everyone agrees with this assessment, but that doesn't mean there aren't other bubbles investors should avoid. Jason Whitmire, a partner at Earlybird Venture Capital, told Benzinga about a couple of these dangerous sectors.

1. Food Delivery

"There are a couple of different areas that puzzle me," said Whitmire. "One of them is food delivery. We're seeing some phenomenal [capital] going on with Just Eat and Foodpanda and everything else."

In March, Foodpanda announced that it had raised $110 million from Rocket Internet AG and a hodgepodge of others. JUST EAT PLC JSTLF raised nearly $600 million when it debuted on the London Stock Exchange in April 2014.

Whitmire compared food delivery to GoDaddy Inc GDDY, saying that it was "so 1990s."

"But there's this hype around it, 'cause suddenly it's like, ooh!" said Whitmire. "If you look at consumer behavior, it's not like they're ordering a terrific amount more online. It's the same stuff. You have the same segment of people that want to go to good restaurants, and you got the same segment of people that are ordering food delivery. So it's nothing revolutionary."

Whitmire expects more money to be poured into this space over the next 12 months.

Related Link: 5 Companies That Own (Or Will Own) The Food Delivery Space

2. Maid Services

"We're seeing a lot of stuff that's being re-spun as, oh, this is super innovative," said Whitmire. "For example, home maid service. It's like, ooh, wow, you can order maids online!"

Handybook, one of many services hoping to cash in on this market, raised $30 million in June 2014. Before that, Homejoy took home $38 million. Last December, Helping raised $17 million.

"Hey guys, let's just keep looking at real tech," Whitmire continued. "You're gonna see some cool stuff in the security space in the next 12 months. You're gonna see some great companies go public. You're gonna see some awesome stuff…and it's real stuff."

3. Biotech

Sean Udall, CIO of Quantum Trading Strategies and author of The TechStrat Report, chimed in with the third bubble: biotech.

"It's like a mini-bubble," Udall told Benzinga. "I [am concerned about] spec biotechs that have no approved drugs yet, in general, even if they're gonna do big drugs."

Udall said that Juno Therapeutics Inc JUNO is a good example.

"Juno has a $5 billion market cap," he said. "I kind of liked Juno conceptually. If Juno was $25 to $30, I'd probably own some. I would own it [while still thinking it's] very expensive at a $2.5 billion market cap."

Udall said he could "potentially stomach" that lower price because the company's drug therapies look promising.

"If you buy Juno today at a $5 billion market cap, you kinda gotta believe they're gonna come up with something that at least has $500 million in sales pretty soon," said Udall. "To pay more than 10 times sales is already kind of pricey."

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.

Image Credit: Serge Melki, Flickr