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0 pointsarethuza13y ago0 comments

"If your valuations are based on what someone else might pay in future, you are speculating"

Isn't that what angels and VCs always do then?

0 comments

Pretty much, yes, though you could argue that the best ones speculate not on what others will be prepared to pay for a company in the future, but on what they think a company could earn.

Pinterest, Instagram etc will likely never earn enough to pay back their current crazy valuations, so their valuations are the first kind of speculation, not the latter. Personally I feel Facebook is also in this group, and is overvalued right now, given their current and likely future revenue.

j / k navigate · click thread line to collapse

0 pointsarethuza13y ago0 comments

"If your valuations are based on what someone else might pay in future, you are speculating"

Isn't that what angels and VCs always do then?

0 comments

grey-area13y ago

Pretty much, yes, though you could argue that the best ones speculate not on what others will be prepared to pay for a company in the future, but on what they think a company could earn.

j / k navigate · click thread line to collapse