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Breakingviews: Virtual valuation chat

Friday, June 06, 2014 - 03:31

June 6 - Breakingviews editors enter virtual reality to consider whether Facebook's nearly $130 value per user justifies the $19 bln it paid for WhatsApp and perhaps other acquisitions too.

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We're also trying to get our heads around tech valuations so our own Richard deals. Put his into a virtual reality machine to try to figure it out. It took a look again that at Facebook. And that's what's up vital to train under that has been -- with nineteen billion goes on this you know always revenue tree company. Which now has half a billion uses right growing very very quickly -- Padilla -- announced people thought maybe there was a decimal place it's right up ninety billion dollars them in this -- -- -- -- obviously you can look at the revenue and profit which is the traditional way and much more comfortable way for us look at these things and you. You can and these drugs that have no idea of that threat. But I'm looking at cup value the use of which is terminal school -- incidentally went looking things to -- it depends Tokyo that much money can make it raises but. But let's get that that's given that FaceBook has that big a price stopped its uses of value right now at least it Hadley the reviews about it well above a hundred bucks for use. What's that we'll face -- paid for what that is less than fifty books is actually very much in line with what they stupid it's -- -- -- and had many many many fewer uses than what that did play it. This is this is a bargain if you're just put on -- -- -- an -- Headset regularly did that get things like finance is the number is all I don't necessarily so twentieth century. OK again this isn't money these are users. -- but it's a bit like the the field General Electric under Jack Welch went there lower trading at forty times -- company twenty their earnings now. Art forty instant -- in getting out of course they were buying earnings by this is buying. I've users and eyeballs and you know I mean let's assist. Out of a throwaway remark that read we -- Silicon Valley the other day. -- let you know if everything with a billion uses leveling with culpability uses his left under a minute hundred billion dollars threats like. So -- on that logic. FaceBook could be -- Martha Zeller right and songs it's using stock which is using and many of these things right it's funny money for more funny money in May be that all works out it's not like they're taking on debt. To ride this stuff that has no. Income it's all part of the great that they are having -- -- -- among obviously there's two bits that this particular virtual reality has that kind of -- right one -- Can you turn these people into money Google does that very well very different kind of business right and it did so from the start candidates -- from the start FaceBook does it better than twitch of movement this will do and you can say that leaves a potentially can say that system -- -- what's -- case of course that they they said they market for privatizing them. What's out Brett and the only way you can do this I guess by charging for the this right. Tax mast right now -- (%expletive) year so -- here and there is a huge chunk of revenue out there that telcos that. But that at the moment all the -- disrupting -- basically zero rather than. Remember plans are cutting it. Britain's daily the other question of the rise of this if you talk about the edifice has these highly valued uses -- snap up more remote companies with hughes' role altogether is that. It's it you know not all these guys are gonna be that application the winds and it. So what's that may be but it -- the -- by as a couple of others than we have what a couple of men may may -- -- only the winners. Uses a going to be left that -- -- we will leave it there will be planning more to think about terms of tech valuations will be back with more. Breaking -- next week.

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Breakingviews: Virtual valuation chat

Friday, June 06, 2014 - 03:31

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