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It is hard to compare companies that are bought out, since they are valued higher due to the network affects with their new parent company. i.e. if Instagram h
by Guvante 13y ago
It is hard to compare companies that are bought out, since they are valued higher due to the network affects with their new parent company.
i.e. if Instagram had a valuation of $800 million the $1 billion purchase price could make sense if Facebook believes their combination could produce the difference in price.
- dredmorbius 13y agoIt's not just network effects. Purchase of Snapchat at $21 billion, or Bebo at $870 million, had a lot to do with attempted strategic positioning and/or edging out competitors who were eyeing acquisition. Doesn't always mean the acq will perform to price.
- Guvante 13y agoBut those are network effects. If I buy a product and kill it and make more money than if I had not purchased, then it was good acquisition.
- deleted 13y ago[deleted]