What matters is not how much revenue you generated over time in the past, but how much you are generating right now and what the expectation is of future revenu

What matters is not how much revenue you generated over time in the past, but how much you are generating right now and what the expectation is of future revenues. If you get down to just numbers, the 'standard' way of valuing any enterprise is to calculate the current value of their future cashflow. This is why (many) V.C.s ask you for a revenue projection. It is debatable whether this is the right way of doing things; in the case of most startups it may be the wrong way, but if id Software was making, say, only 10M/year at the point they got bought, and left alone, if their cashflow would have stayed the same or stagnated, 105 million would be 10.5x their yearly profits which is decent.