Aileen Lee of early stage fund Cowboy ventures wrote a post for Techcrunch yesterday looking at the characteristics of 39 startups founded since 2003 that are worth over $1bn. She calls them ‘Unicorns’. There has been a lot of discussion since. Most notably Dave McLure who Tweeted that “The future of venture capital is [...]
NOTE: I wrote the post below a couple of weeks back but failed to hit the publish button. That was before Twitter filed their S1 with a valuation of c$15bn. Whilst that’s not an outrageous increase from $10.5bn from what we know of Twitter’s finances it seems pretty spicy from a multiples perspective – [...]
I just read How LinkedIn became a Wall Street juggernaut on Techcrunch. The article lists four things, three of which relate to being a great company (multiple growth vectors, a product that gets better as it gets bigger, deep competitive advantage). The fourth describes how their approach to the market, which was to under [...]
Ben Rooney has an article up today on the Wall Street Journal reporting that European tech companies are valued on lower multiples than US businesses in M&A transactions:
The amount paid for a company as a multiple of earnings before interest, taxes, depreciation and amortization, or Ebitda, for U.S.-based companies rose from 11 times [...]
Ernst and Young’s latest quarterly Global Technology M&A Update found that the number of announced deals is pretty much flat year on year and compared with the last quarter, but the average value of those deals fell sharply to $185m. That’s 43% down on Q3 2011 and 12% down on Q2 2012. There were [...]
One of the world’s larger investors in venture capital recently shared data with us about the multiples they have made on over 5,000 companies they had stakes in via their LP investments in US VC funds. I’m not sure the extent to which they are happy with the information being made public so I’ve [...]
I was on a panel at the excellent Dublin Web Summit yesterday where we discussed the balance of VC interest between consumer internet and software companies. My perspective is that for most of the last five years the balance was shifting in favour of internet, but in the last year or so software companies [...]
HR software business Workday has just upped the proposed share price in its coming IPO to $24-26, taking its valuation over $4bn. That’s 30x this years forecast revenues of $134m. Moreover, the company says in its filing that it has “a history of cumulative losses and we do not expect to be profitable for [...]
In its quarterly filing yesterday Facebook disclosed that it spent $24m on ‘talent focused acquisitions’ in the first half of 2012. Techcrunch has done some digging and identified the companies as Tagtile, Glancee, Lightbox and Karma.
This raised two interesting questions for me.
Firstly – can investors make a decent return on businesses that [...]
Many great services whither and die following acquisition and when Microsoft acquired Skype I feared the worst. It turns out I was wrong. Microsoft announced yesterday that we all made 115bn minutes of calls over Skype last quarter, a whopping 50% up on the quarter before.
They also announced an integration with Outlook [...]