4 ms·

Do you mean your buyers paid 20x your business' yearly profits? Why?

• jacquesm 11y ago
  Excellent question! But I don't have the answer for you.
  • dennisgorelik 11y ago
    But did you actually sell at 20x yearly profits?
    • jacquesm 11y ago
      No, I sold at 20x turnover.
      • dennisgorelik 11y ago
        20x gross revenue? Wow! What was the name of that business and what year was that?
        • jacquesm 11y ago
          None of your business :) But it's very well possible to make deals like these, it just matters that the buyer has a different idea of the value of the business for them than you do. Which answers your earlier question in a way, but the 'why' is actually probably a lot more complicated than that and I can't really speak for the buyers, the only thing I know for sure is that they had a totally different idea of where they were taking this than I did. They probably thought it was cheap. Beauty is in the eye of the beholder...
          • dennisgorelik 11y ago
            Actually, I just compared your deal with Twitter: 12 months revenue ending 2013-12-31: $664.89M Twitter IPO Valuation: $24 Billion (Nov. 07, 2013) Price/Gross revenue ratio = $24B / $664.89M ~= 43x That makes your 20x sale look like an underperformer.
            • jacquesm 11y ago
              Yes, there are many other deals that are better. You forgot to ask the key question though :) But I'll let it rest, none of this is for public consumption and I shouldn't have written the first comment.
              • dennisgorelik 11y ago
                What is "the key question"?
                • kirubakaran 11y ago
                  Purchase price, most likely.