15 comments

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  Adam Ostrow

  1 year ago

  I recently came to the conclusion that an installed user is worth about $1.40, based on the earnings of the only pure-play FB app company that is publicly traded (that I know of) - http://mashable.com/2008/01/16/snap-interactive/
  
  Of course, that numbers can change a lot based on the biz model of the app.
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  mathewi

  1 year ago

  Thanks, Adam -- that's interesting. So according to that math, an app
  like Top Friends alone would be worth $35-million. Doesn't that seem
  a little high to you? It does to me.
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  Adam Ostrow

  1 year ago

  I didn't say it was fair value, but that's what the supposedly rational open market is valuing them at ;-)
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  mathewi

  1 year ago

  Well, the real determining factor of value is what someone is willing
  to pay for it, of course :-) So I guess we'll have to see who is
  willing to pay $30-million or so for each of Slide's apps.
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  Corvida

  1 year ago

  I highly doubt it would rake in that much money or generate more than 30-million and grow exponentially or even at all to that amount or beyond that amount. I think it's totally unrealistic for ANY ad model they put into these applications. It would have to be several apps generating that much. Not just one.
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  antje

  1 year ago

  this is seriously starting to piss me off - excuse my french - I talk to companies who are doing great things all the time, much more sophisticated and interesting than an embedded photo displayer (I like Slide but come on), and a widget company getting this kind of money at that valuation is asinine.
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  Lee Lorenzen

  1 year ago

  Matthew,
  
  Both Slide and RockYou have over 100 million facebook installs for their apps and over 30 million unique facebook users that interact with those apps and with whom these app aggregators can communicate via Facebook's messaging system. That means that each of these companies can sample detailed user profile data from about 50% of Facebook's entire population.
  
  If you had a company that had the right to interact with half of Amazon's install base or half of eBay's installs base, a potential competitor to Amazon or eBay (or these companies themselves) might be very interested in acquiring these companies. The reason is that they represent a strategic threat to Facebook if they were in the hands of either Google or Yahoo or LinkIn or Bebo, etc. So, one reason for the higher valuations for these apps is their overall reach. The Adonoimics valuation takes this into account.
  
  WRT antje's comment above about how other companies doing more interesting things are getting lower valuations, I'm going to bet these other companies don't have 30+ million unique users.
  
  Thanks,
  Lee Lorenzen
  CEO, Altura Ventures -- the first Facebook-only VC
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  antje

  1 year ago

  hmm, 30 M unique users. Active users? Based on the backbone of another company (who could theoretically cut them access at any time)? and most don't have much revenue other than advertising? Not so sure I'd base an entire investment firm on "Facebook-only" but WTH do I know....
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  leigh

  1 year ago

  I would add on to Antje's point - all this great data everyone keeps speaking about...i work in marketing communications - companies have got nothing but data (customer data, market research, website, yada yada yada) and they do, well, pretty much nothing with it. So why is everyone so damn hot over the data? Particularly on a closed network, that to Antje's point, other people own?
  
  And great marketing isn't based on demographics anymore. So really, what are you all investing in? If the app somehow supplied info about unmet customer needs in a particular verticle, maybe then someone should care.....
  
  I'm sorry but this is the 1.0 equivalent in my mind of investing millions of dollars in a destination site for people who own dogs.
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  drBaher

  1 year ago

  Whether this valuation makes sense or not is up to facebook's future, You can check my post about it http://technozzle.com/?p=51
  
  I guess that similar deals/valuations will take place this year because of the "Facebook effect".
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  Mark Evans

  1 year ago

  Truly amazing! I wonder what kind of fundamentals, if any, are used to come up with this kind of valuation?
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  mathewi

  1 year ago

  As far as I can tell, it's just pick a number and then multiply it by the
  number of installs -- and the number is based on assumptions about ad
  revenue per app.
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  Lee Lorenzen

  1 year ago

  The Adonomics Valuation methodology is described here:
  
  http://blog.adonomics.com/2007/09/24/an-adonomi...
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  antje

  1 year ago

  I'm looking at this while trying to find past articles about valuations of pets.com and bluelight and webvan in the day. At least they SOLD something. They had product, they had something tangible. This just blows my mind. Companies making biomedical devices can't get $5m and Slide gets $50M. For what?!! Please someone elighten me. I am either a total idiot or I don't get something major here. And - in a saturated market (photo sharing)?
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• 

  buying gold

  1 year ago

  the bubble. she is here. all signs point to it.
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