4 ms·

How long did Amazon float by on potential while running at a loss? Companies can raise funds if people think it'll succeed.

greglindahl 9y ago
Amazon is still mainly valued on projected earnings after 2020 -- the only recent change is that they went from steadily losing money to slightly making money. But the money that they're making now does not justify their stock price.
- thanksgiving 9y ago
  My impression was that Amazon does make plenty of revenue — it is just that all of the "profits" simply gets reinvested into Amazon? Is that too naïve? My thought was, hey they found something useful to do with that money. (Funny how I don't see Twitter that way. I think they could/ should cut their spending by something like $1B a year.) I'm of course comparing Amazon to apple which makes so much money that they can afford to keep it "cash" as opposed to reinvesting.
  - tim333 9y ago
    Indeed Amazon has never needed much funding. Crunchbase showed their most recent raise as being $100m in 2001. Uber is very different. Their burn was $991m in Q4 2016 and growing.
    - lorenzorhoades 9y ago
      Once the company goes public, the amount of money they raised is included in their finances, and not counted as a round. Take a look at the Amazon finances and you'll see how much they have raised on loans. The higher the stock price, the better loan pricing they can secure. This is the strategy that Tesla employs as well.
TheCoelacanth 9y ago
Amazon never burned through multiple billions of dollars a year.
- temp20160423 9y ago
  It's pretty naive to make statements like this. Uber came into being when interest rates were near-zero for 5+ years (in comparison, interest rates were 5%+ in the first dot-com bubble). Money was basically free in 2009-2015. Uber likely had extremely favorable terms for its funding rounds. Now that the fed is finally raising rates again, we'll have to see if Uber can become break-even within a few years.

greglindahl 9y ago

Amazon is still mainly valued on projected earnings after 2020 -- the only recent change is that they went from steadily losing money to slightly making money. But the money that they're making now does not justify their stock price.

thanksgiving 9y ago
My impression was that Amazon does make plenty of revenue — it is just that all of the "profits" simply gets reinvested into Amazon? Is that too naïve? My thought was, hey they found something useful to do with that money. (Funny how I don't see Twitter that way. I think they could/ should cut their spending by something like $1B a year.) I'm of course comparing Amazon to apple which makes so much money that they can afford to keep it "cash" as opposed to reinvesting.
- tim333 9y ago
  Indeed Amazon has never needed much funding. Crunchbase showed their most recent raise as being $100m in 2001. Uber is very different. Their burn was $991m in Q4 2016 and growing.
  - lorenzorhoades 9y ago
    Once the company goes public, the amount of money they raised is included in their finances, and not counted as a round. Take a look at the Amazon finances and you'll see how much they have raised on loans. The higher the stock price, the better loan pricing they can secure. This is the strategy that Tesla employs as well.

TheCoelacanth 9y ago

Amazon never burned through multiple billions of dollars a year.

temp20160423 9y ago
It's pretty naive to make statements like this. Uber came into being when interest rates were near-zero for 5+ years (in comparison, interest rates were 5%+ in the first dot-com bubble). Money was basically free in 2009-2015. Uber likely had extremely favorable terms for its funding rounds. Now that the fed is finally raising rates again, we'll have to see if Uber can become break-even within a few years.