This analysis was first published in SvD Näringsliv, in Swedish, on November 30th, 2021.

Zoom: down 61 percent. Twitter: minus 40 percent. And Pinterest: down 53 percent. The crash among established tech companies can be hard to spot if you are leaning comfortably on the popular tech funds.

In politics they are often lumped together as big tech — companies like Facebook, Amazon, Apple, Microsoft and Google. They have landed in regulators’ crosshairs countless times — most recently in the EU, which is preparing to push through a new law aimed at every tech company with a market cap above 80 billion euros.

But talking about big tech as one sweeping category is usually wrong. The label captures the companies’ size and influence rather than any shared technology — they each dominate different areas. They may set the direction for the tech world, but they are hardly representative of it or its health.

Because in a year when the five giants are at — or close to — all-time highs on the stock market, many of the smaller tech companies have at the same time been crashing. Pandemic winner Zoom has lost 61 percent in a little over a year. Teladoc — one of Kinnevik’s holdings — has dropped 63 percent since February. Established companies like Pinterest (-53 percent) and Twitter (-40 percent) are pointing sharply down.

Many new listings have had a tough time too. Half of all companies that went public and raised more than a billion dollars in capital are now trading below their IPO price. Among them: the stock trading app Robinhood, the delivery service Deliveroo, and China’s Didi, often described as the Uber of China.

In Sweden, too, the past three months have produced blood-red numbers. Market rockets Evolution Gaming and Sinch have dropped 37 and 40 percent from their peaks. Both, it should be said, are still up on a full-year basis. Worse is the e-commerce company Desenio, which has plunged a full 74 percent since its IPO in February this year.

The decline is not entirely visible to those who mainly hold funds. Nordnet’s Indexfond Teknologi, which tracks the MSCI World Information Technology index, has for example risen 29 percent since its launch this summer. But in the underlying index you find both Apple and Microsoft, each weighted around 17 percent. The enormous success of big tech, in other words, masks what has happened in the index overall — which also includes iZettle-owner PayPal (-39 percent), another heavy faller.

So why are these crashes happening? There are several contributing macro factors, and the prospect of future rate hikes is likely a strong one. Tech stocks fell when Jerome Powell was reappointed as chair of the US central bank, since he is expected to raise rates going forward. Low rates are generally seen as favorable for tech stocks, as the hunt for yield increases and risk appetite rises. There is of course also worry about new covid variants and how they might affect the economy.

But what also becomes clear in today’s market climate is that big tech has a resilience many smaller tech companies lack. The giants all enjoy enormously strong market positions with monopolistic tendencies in parts of their businesses. Google’s share of the search market is for example over 85 percent, despite — or because of — the fact that it is more than 20 years since the company was founded. And there is nothing to suggest that this balance of power will shift in the near term, even if new players join the big tech group in time.

Looking at tech companies as one solitary category can therefore be treacherous. And it is one step further down in the sector that you find the e-commerce, business services, gambling, ad sales and payment companies that all build their own markets with the help of technology — and that may be having a particularly rough time right now. For anyone who wants to keep track of their holdings, it is worth digging deeper than the index number or big tech.

Footnote: stock prices are as of November 30th, before the opening of the US market.