[TheGeminon]

Where are you getting that the company is worth $50m? The article says it’s a “$100 million-a-year” business

[bigtunacan]

To oversimplify a company with $100MM revenues annually and costs of $120MM annually is still losing money and has a real current value of $0.

[AceJohnny2]

That’s revenue, which is different from company value.

[mydriasis]

Oh boy, if his 100MM/year in revenue business is only worth 50 million, most startups are _really_ in trouble.

[AceJohnny2]

Why yes, company valuation is uncorrelated from revenue.

By the way, this is why VCs love software startups, and drive so hard for an IPO exit.

[missedthecue]

Most startups are growing faster than a literal grain mill, and they have good unit economics. Another customer costs little for a software company. Another customer can cost a lot for a grain mill.

These contribute to valuation.

[cscurmudgeon]

Look up revenue multipliers:

https://www.bizbuysell.com/learning-center/industry-valuatio...

[c0pium]

That’s pretty clearly what they’re talking about, yes.

[cscurmudgeon]

Not really. They and others here seem clueless about multipliers less than 1.

[c0pium]

They described a fractional multiplier. That’s their whole point.

[_heimdall]

I guess this explains Nvidia's valuation.

Revenue and company value are completely disconnected.

[AceJohnny2]

Yes, see "P/E Ratio" aka "Price to Earnings Ratio", which is a basic measure of how overvalued a company is.

[gottorf]

I believe the preferred Wall Street parlance now is the "price to innovation ratio" ;-)