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In my opinion, they need to focus. Cut a bunch of stuff, find a niche they can dominate, and rebuild. Either be a bad-ass server platform, amazing social app,
by dhimes 11y ago
In my opinion, they need to focus. Cut a bunch of stuff, find a niche they can dominate, and rebuild. Either be a bad-ass server platform, amazing social app, or perhaps apply themselves towards a select group of people (aging seniors or something)-- whatever they think they can do-- but focus. It will be painful. But it's their best path forward I think.
- hodder 11y agoMakes sense, but the problem is, those niches described are filled by entrenched competitors, or don't really justify the market cap. I feel the best for the company is juicing rev, earnings, and FCF, and they can't do that by trying to get a foothold in saturated markets as the cost is too huge or ramp up time too long. I am also not proposing they take a VC approach like they have where they pay huge multiples hoping to somehow have the success at selecting winners like yc. I am proposing they buy companies that are generating growing free cash flow at sub 25x levels.
- dhimes 11y agoMy niches were not meant to be a knowledgeable insight, just examples. And you have a good point about buying cash-generating companies (companies that are winning the niche battles). But they really need to focus- and only buy companies that are in that focus. If they are a media company then they are competing with Condé Nast, Youtube, and bloggers everywhere. But if they are, for example, an educational media company, then the scope is clearer and they can muster some leverage.