What are the main driving factors behind each of the big value investments? The perceived quality/worth of LinkedIn's userbase? The fact that they're already monetising? ($1bn = 10x multiple on yearly turnover..)
For LinkedIn, the most important thing is definitely their very real revenue coming from their huge CPM rates. >$15CPM, I've heard.
Slide's ridiculous valuation comes from their reach and the idea that eventually someone has to figure out how to monetize social networking eyeballs. When (if) that happens, Slide will be in a great position.
Meebo is kind of neat and isn't trying very hard with revenue.
Companies have various sources of financing, some considered better than others.
They can take a bank loan ...
They can buy on credit ... buy something, pay for it several months later is a canonical form of financing
They can sell bonds ...
They can offer shares ...
There is normally competition between these forms of finance, and i heard banks usually try to offer the most competitive finance offer, so believe it or not banks loans are usually the best ...
linkdln will probably have to work harder for those 53M than if they were a loan
Finally, financing one firm from its own revenues, I believe is called auto-finance , or something like that, ... and beside the fact that they probably will and do take a portion of their revenues for self-finance ... they probably need more money to expand, and have seek other ways.
I am not sure thought how auto-finance compare to other forms of financing, but i think its one of the best and least expensive .... i need to look more to it, you can learn more about this stuff from the books about finance etc ...
There is a recession right now, sometimes it is a good idea to just raise money when you can, especially when the dilution doesn't really effect anything.
Slide: $50M @ $550M valuation - "134M global unique visitors/month", ..revenue?
Meebo: $25M @ ~$200M - ~2M monthly uniques, ~$1M revenue (I think - recall reading somewhere..)
What are the main driving factors behind each of the big value investments? The perceived quality/worth of LinkedIn's userbase? The fact that they're already monetising? ($1bn = 10x multiple on yearly turnover..)