Absolutely Insane
From a post on Techcrunch.com about Pluck being purchased:
We’ve confirmed the number from an inside source – $75 million, all cash. Pluck revenues are around $10 million/year.
…
the price paid is certainly less than investors had hoped for when writing their checks.
OK — let me get this straight…revenues of $10MM/yr…sold for $75MM…investors not happy.
I’d be happy. The total amount invested was $10MM with the last raise in 2004.
That’s a nice return in my book.
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David Pitts March 21st
Yes, that is low. Depending on the industry, (one way to determine this) a company is valued at X times the yearly sales. Some industries are 20, some are 4, etc. The buyer is saying that that company’s value was worth 7.5 years of sales.
Given what pluck does, combined with what some sites have either sold for lately or have been offered, I would agree that it was sold than considerably less than its value.
$0.02
–David
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