[rstocker99]

Are you asking about valuations? FE has a post on how valuations work. It's pretty simple. Basically a multiple of how much cash you can take out of the business. If that number is small and not growing then the multiple is small. If the number is big and/or growing fast then the multiple will be larger. The key is it's about how much cash the business makes now vs. traditional tech VC land is about... how big this might be some day maybe.

If you're interested in buying a business the people who know how all this stuff works are the private equity people (PE). These guys do this stuff all day long (obviously at much larger scales. If you search you can find a fair amount of info on PE. On a smaller scale there is good info from people researching search funds. Search funds are basically small scale PE. Here's a good starting point: http://www.gsb.stanford.edu/faculty-research/centers-initiat....