4 ms·
My rule of thumb is that if you can get 100M monthly users you can sell your company for $1B. It doesn't matter what your product or platform or service is. It
by forrestthewoods 10y ago
My rule of thumb is that if you can get 100M monthly users you can sell your company for $1B. It doesn't matter what your product or platform or service is. It doesn't even matter if you have any revenue. If you can get a hundred million monthly users then you can sell for 1 billion dollars.
At least that's what I've observed over the past few years. Twitch was bought $1B with a mere 50M users. But highly engaged users with successful monetization. So it fits my model. WhatsApp was bought for almost $20B under the assumption they could hit 1B users. A 2x premium for being so large.
So roughly $5 to $20 per user. That seems pretty reasonable.
- TeMPOraL 10y agoUnless I see evidence to the contrary, I assume that all startups follow your model - i.e. they don't give a damn about the product they're making[0]; they need something that'll give them a good growth curve in order to get bought for $alot[1]. I wonder if and when people get tired of that. I also wonder how user engagement/retention numbers evolve globally over time; if almost everyone treats their users like cattle, I won't be surprised if more and more people started treating on-line services as throwaway. [0] - corollary: all the "we're trying to change the world", or "our passion is to help you do X" they say on their page is just lies. [1] - that also applies to paid services; I've read that classic Maciej's post[2] about paid vs. free services, but companies aren't stupid; if being paid signals trustworthiness and leads to more users, they'll make the service paid [2] - https://blog.pinboard.in/2011/12/don_t_be_a_free_user/ https://blog.pinboard.in/2011/12/don_t_be_a_free_user/