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It's amazing how tech companies and unicorns are valued. If they are losing, the public market or VC's cover their aes and their value stays neutral, and first
by jxub 9y ago
It's amazing how tech companies and unicorns are valued. If they are losing, the public market or VC's cover their aes and their value stays neutral, and first signs of profit send the stocks to the moon.
That is also the behaviour of crypto, but in this case the stocks aren't overvalued to start with, as decades of inflation have done to stocks.
Looking from another side, in crypto we haven't developed a sound investing framework yet, other than the usual github/reddit/social/TA checks, possibly because we are dealing with a protocol, not a product.
The interesting thing here, and maybe a somewhat contrarian position to take in the Twitter case, is that they're not a tech company, but a protocol company. And their value can't be measured with a number, they're essentially playing the same field as TCP or IRC, which value we haven't measured.
I would be buying $TWTR stock, if it weren't for cryptos like VEN, GVT or REQ which may be equivalent to investing in Twitter in the seed phase. Actually, this line of thought is really interesting, I may write something longer and more coherent about this stuff.
- wbl 9y agoHow did being a protocol work out for DEC? Or Sun?
- jxub 9y agoBeing a protocol company is risky for adoption, but helps develop a huge moat over the competition, which doesn't remove the possibility of becoming an E-Corp-like company and/or dying from inefficiency. No idea about these two in particular sorry.
- jonknee 9y ago> If they are losing, the public market or VC's cover their aes and their value stays neutral In the past year TWTR has been as low as $14.12, it has been anything but neutral.
- jxub 9y agoSorry, I might be too used to the swings in crypto. Last year has been bad for twitter indeed looking from traditional-Buffetian investing point of view.
- icedchai 9y agoHow is Twitter a protocol company? Protocol implies open standards, like IRC or SMTP... The only place I can tweet is Twitter.
- wpietri 9y agoAgreed. Social companies like Facebook and Twitter started out with open APIs, but closed them as they grew more successful precisely because they don't want to be protocols. I don't like that, but I get it. The money is in owning the user experience. And it's hard enough to continuously improve your user experience when all the people making that software work for one company. I think one of the reasons email and IRC are losing out to things like Facebook and Slack is that it's nearly impossible to make those things broadly better.