Slide valued at $500M+, half a billion dollars

slide

From Today’s NYTimes:

Slide, the maker of applications for social networks, has raised another round of funding - $50 million from the private equity funds at Fidelity and T-Rowe Price, two major Wall Street investment houses. The firms have taken a 9 percent stake in the three-year-old, 64-employee Slide, valuing it at $550 million.

Most interestingly, the investors are Fidelity and T. Rowe Price.

I guess one could argue that Slide is not a widget company but an ad network.

Here is what Max Levchin said in his interview a few months ago:

Think of Slide as a giant media network for people to transmit information. The content that’s in there now has been provided by users — it’s whatever they want it to be.

But my issue with that argument is that the slide is not hosted voluntarily by MySpace and FaceBook - users put it there. It is unlikely that MySpace will let Slide monetize their presence on their pages and Facebook looks kind of dicey too. The point is that Slide is not in control of their visitor count - they rely on other networks to get the audience.

How much is a Facebook application worth? Face book is valued at $15B which equates to $250 per user. There are some, who argue that an application on Facebook is worth $250 times the number of users. That is just wrong!

Facebook applications are like little antenna balls for the car. Don’t tell me that the goofy antenna ball is worth as much as the car. Some have argued that each install of an application is worth $3 to $0.30 for each install, which is high but at least in the ball park. Again, the number is per install, not per application view.

Slide is not saying that they have 150M registered users or 150M installs - just 150M visitors. They might have 25M to 35M install base. With $550M valuation, they are valuing it at $20 per install. Also, the widgets have a short lifespan; they come and go, so active install base might be smaller.

And then there is the Facebook "tax" (rev-share that Facebook will demand), which further reduces the value.

Some may argue that the basic fallacy in this valuation calculation is that you are looking at current numbers - extrapolate to 2011 and then calculate the valuation. Its the growth potential that demands a much higher premium. I don’t fully agree with it but the argument has a certain conceptual merit. One should calculate these numbers by examining the forward flow and not the current numbers. Not sure if I can stretch my imagination to 2011, but if Fidelity with deep pockets can see farther than I can, more power to them.

This sort of reminds me of the BlueMountain network, it was valued at $780M when @Home acquired Excite for $6.7B (at $400 per user) during the period of last exuberance.

But I am glad that deals are happening, and the developers are creating more applications. And if widgets are being valued highly in the marketplace, I am giddy, incredulous but giddy nonetheless.



Guy Kawasaki’s 10-20-30 Rule for presentation

 

 

 

Guy Kawasaki’s 10-20-30 rule for presentation:

  • 10 slides
  • 20 minutes
  • 30 point font

I don’t think I agree with rule as a blanket statement, but I do agree with the concept that one should have fewer slides and leave some room for questions and not use too small a font on the slide.

The number of slides and the font size is dependent on the audience. Angel investors like to see a lot of details - they are funding the “idea” and want to see it flushed out a bit more. So for that audience 10 slides in 30 point font won’t work.

Also, I have noticed that the power point presentation at a VC firm get circulated to a lot of people who weren’t there at the presentation. For their benefit, the slides need to have enough content to provide context.

I tend to use 30 points font for the basic ideas but also include small font text in a bulleted list form. So if any member of the audience has a specific question, I can point to the small text.

If you have already established yourself as an “authority” in the subject that you are going to talk about; you can get away with 10-20-30 rule but if you are pitching the idea to angel investor group, you need to show that you have thought about various elements in your presentation and that, unfortunately, requires use of small fonts on the slide.

This is especially true now when the power point presentation has taken the place of a business plan. It is not uncommon to hear from a VC “send me your power point and a one pager”. I am not suggesting that you try to cram the business plan in to the power point, but you need to be cognizant of the fact that VCs very often don’t read the business plan and may rely on the power point presentation. So use the fewest number of slides you can get away with and make sure that all the core concepts are in size 30 font.



A long list of Web business models

business_model

Chris Anderson, Fred Wilson and Dave McClure have created a great list of Web business models. The list includes:

  • E-commerce
  • CPM ads
  • CPC ads
  • CPT ads
  • Lead generation
  • Subscription revenues
  • Affiliate revenues (think: Amazon Associates)
  • Rental of subscriber lists
  • Sale of information (selling data about users-aggregate/statistical or individual)
  • Licensing of brand (people pay to use a media brand as implied endorsement)
  • Licensing of content (syndication)
  • Getting the users to create something of value for free and applying any of the above to monetize it. (Like Digg)
  • Upgraded service/content
  • Alternate output (print/print-on-demand, t-shirts, etc)
  • Custom services (installation, support services)
  • Live events
  • Souvenirs/”Merchandise”
  • Co-branded spinoff
  • Cost Per Install (popular with top Facebook apps)
  • Sponsorships
  • Listings
  • Paid Inclusion
  • Multimedia ads (video ads)
  • API Fees (charging third parties to access your API, like Alexa)
  • FeedSense
  • FeedSearch
  • FanPageApps

To this, I have a few more to add:

(i) Donations. Several sites that I visit frequently, do not charge for the services/software they provide, but rely on donations from the user base. Many of the torrent sites follow this model as well.

(ii) Domain name value appreciation. This is a modern version of Sears, where the operation of the company lost money but the real estate owned by company appreciated significantly. Example - spark.com; the site lay dormant for a long time but the domain name appreciated in value. Spark Networks, a collection of dating site, purchased it in 2004; I know because I negotiated the deal for the purchase of spark.com and worked with Spark Networks on the IP side of their re-branding strategy.

(iii) Ad exchange credits. I haven’t seen this used recently, but this method involves showing ads from an ad-exchange and accumulating reciprocal ad credits, which can be sold to third party.

(iv) Sale of traffic. Example - BlogOhBlog.com gave away free wordpress themes for about 6 months with very limited monetization. At the end of the 6 month period, it had 100k visitors/month and the domain name BlogOhBlog.com was sold for $10k.

I am sure there are others. Please leave a comment here or at Fred’s blog if you would like to add it to the growing list.



Green cars - top picks

Green cars are getting - well greener with the latest crop of electric and hybrid cars hitting the market with prices all the way up to a half of a million dollars!

Our top picks of the electric/ hybrid cars

image Most likely to impress: The Venturi Fetish wins this category. The fact that you were willing to drop $435k just to save the environment has to impress a few folks. So what if it sports less of a range and top speed than cars a tenth of its price? If you are worried about such mundane things, you might be looking at the wrong end of the spectrum!

 image Most likely to get rid of your date in a hurry: If you have an extra $108k, why not spend it on something really ugly - like the Commuter Cars Tango T600? With a face only a CEO could love (and a body to match!), this strange 3 wheel design electric could make a great getaway car with a top speed of 150 mph and the ability to squeeze between two traffic lanes!

 image The coolest: The most sexy car, by far, is still the Tesla roadster - although the car has had its share of growing pains recently. For those who have been salivating ever since they put down their $20,000 deposits on the car, we wish them the best and hope the wait is not too much longer.

 image Best "value": If you want the most range and top speed for the buck, and don’t particularly care that your car looks like a green bug flapping its wings, the Brazilian Obvio 828e is a good choice. Designed by the racing legend Anisio Campos, the all electric car will get you around town with a max range of 240 miles and top speed 120 mph for a price of $49k.

 image Funniest looking car: In this category, the Myers Motos NmG (No more Gas) rolls on its own. Reminiscent of the wiener mobile, this car makes up for its outlandish looks by not going very far (30 miles, tops)!

 

For a complete list of 27 electric car companies, see VentureBeat.



28 queries. 0.406 seconds.