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My rule of thumb is to invest in companies that make products that many people use. Look around you, how many people use FB?
by Dnguyen 15y ago
My rule of thumb is to invest in companies that make products that many people use. Look around you, how many people use FB?
- CyrusL 15y agoIt's imprudent to decouple popularity from price. Would you invest in Facebook a $200b valuation? $500b? Popularity is already priced in by the market. To invest, you need to have a fundamental belief about the long term prospects of the company above that of the market. I think better answers would be "I think Facebook is a $150b company, so yes" or "I am 50% more bullish on Facebook than the market" or "I think I will be able to sell to people in the future who will be 50% more bullish on Facebook at that time."
- Dnguyen 15y agoIf anyone just blindly put money into a company, they're just as well flip a coin. One has to do due diligent and weight the risk versus reward. And even after putting money into a company, one must constantly evaluate its performance. Using popularity to narrow down the prospective targets is just the first step.