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by wwalser 3483 days ago
The price is going to be some multiple on their revenue, I'd guess somewhere in the 4-6x range.

$20MM is enough to get investors ($7MM invested) off your back and let the acquisition go forward and there is plenty of opportunity for back-end deals where key players have an earn out not represented by the acquisition price.
3 comments
exogeny 3483 days ago
It's absurd that you think PH was doing anywhere close to that revenue.

The sale price to me is baffling, even if it was stock. You're not buying revenue, you're not buying valuable technology IP, and you're sure as hell not buying a world-class team that innovated and built some rocketship product.

So how do you explain it? Maybe the fact that it was bought by one of their investors is a start..

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wwalser 3483 days ago
Is it crazy to think that a website with 2.8MM uniques/month could make could make $280,000/month? I honestly don't know the numbers for a media companies, referral programs or direct resellers.

There's also some obvious alignment between the two companies so maybe it was a much larger multiple than I would have expected. The team absolutely managed to build a product that has captured the attention (in many cases daily attention) of the type of people that AngelList wants.

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skinnymuch 3481 days ago
It's not absurd just looking at the numbers. But looking at the actual site, then yeah it seems absurd. They weren't exactly doing that much to push revenue. I doubt they did 6 figures a month.
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AznHisoka 3483 days ago
How do they make revenue currently? I don't see any ads, and I don't even see anywhere I can promote my product for a fee.

I'll go out on a limb and suggest it's 40-60X revenue, and even that may be too low (anyone from ProductHunt reading, please correct me, but I doubt it).

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wwalser 3483 days ago
You could be correct but I'd assume they are making reasonable money on referral programs and direct sales. I know for a fact that direct sales are a thing (or were at one point)[0]. Basically the "get it" button becomes a checkout for for some products instead of a link to the site. Taking advantage of referral programs also seems like an obvious thing that they _should_ be using. Especially for companies which want a product hunted and already have a referral program in place.

0. https://techcrunch.com/2016/05/19/product-hunt-is-ready-to-r...

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enahs-sf 3483 days ago
It's better to earn out than burn out.
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