Lee Lorenzen
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7 months ago
in How much is a SuperPoke worth? on Mathew's comments
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
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
1 reply
antje
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....
7 months ago
in What is a Facebook app worth? on Mathew's comments
Matthew,
We don't mean to be coy but straightforward. The following post outlines how we come up with the valuation:
http://blog.adonomics.com/2007/09/24/an-adonomi...
Facebook's $15 billion valuation is not hypothetical -- because Microsoft and and individual investor put money in at this price. I actually think it is worth $100 billion (see blog.adonomics.com for the details as to why).
WRT FunWall, an app that has 1/5 to 1/4 of the entire facebook audience has a valuation premium because Google, Yahoo, IAC, AOL and others would pay a lot to have an app that would allow them to harvest out a big chunk of facebook users over time to a competitive social network.
Thanks,
Lee Lorenzen
CEO, Altura Ventures -- the first Facebook-only VC
cell: 831-595-7501
We don't mean to be coy but straightforward. The following post outlines how we come up with the valuation:
http://blog.adonomics.com/2007/09/24/an-adonomi...
Facebook's $15 billion valuation is not hypothetical -- because Microsoft and and individual investor put money in at this price. I actually think it is worth $100 billion (see blog.adonomics.com for the details as to why).
WRT FunWall, an app that has 1/5 to 1/4 of the entire facebook audience has a valuation premium because Google, Yahoo, IAC, AOL and others would pay a lot to have an app that would allow them to harvest out a big chunk of facebook users over time to a competitive social network.
Thanks,
Lee Lorenzen
CEO, Altura Ventures -- the first Facebook-only VC
cell: 831-595-7501
1 reply
mathewi
Thanks for the comment, Lee. I still don't think it's all that clear
how you arrived at the specific numbers for the apps on your list, but
I realize that it's a combination of a number of different factors.
And I would argue that the assumptions around many of those factors --
such as an app's future growth rate, Facebook's future growth rate,
the rise in advertising rates, etc. -- are either flawed, or
ridiculously optimistic, or both.
As far as Facebook's "valuation" is concerned, it is completely
hypothetical. Microsoft bought less than 2 per cent of the company,
and paid a price that was based on a whole range of factors,
competitive and otherwise. To extrapolate from that to the value of
the entire entity or to the value of individual apps like FunWall is
ridiculous -- and I think the same goes for your $100-billion
estimate.
In any case, thanks for the comment.
how you arrived at the specific numbers for the apps on your list, but
I realize that it's a combination of a number of different factors.
And I would argue that the assumptions around many of those factors --
such as an app's future growth rate, Facebook's future growth rate,
the rise in advertising rates, etc. -- are either flawed, or
ridiculously optimistic, or both.
As far as Facebook's "valuation" is concerned, it is completely
hypothetical. Microsoft bought less than 2 per cent of the company,
and paid a price that was based on a whole range of factors,
competitive and otherwise. To extrapolate from that to the value of
the entire entity or to the value of individual apps like FunWall is
ridiculous -- and I think the same goes for your $100-billion
estimate.
In any case, thanks for the comment.