* The Business of Software

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Ust when I thought software market was dead

Now. What do you make of this. is this really worthed 30 million dollars?
<a href='http://bossip.com/748481/teenage-millionaires-17-year-old-british-boy-sells-app-to-yahoo-for-over-30-million-dollars/'>30 million dollar sale for software</a>
cn Send private email
Wednesday, March 27, 2013
 
 
sorry . I hadn't posted links here before. the title also should read
Just when I ...

Now. What do you make of this. is this really worthed 30 million dollars?

http://bossip.com/748481/teenage-millionaires-17-year-old-british-boy-sells-app-to-yahoo-for-over-30-million-dollars/'>
cn Send private email
Wednesday, March 27, 2013
 
 
If this was really worth 30 million, you would think Yahoo with all those engineers , would have just produced something similar.
cn Send private email
Wednesday, March 27, 2013
 
 
Yahoo! is in the middle of re-inventing itself (again) and probably thinks $30m is a good price to pay for all the publicity they are getting, especially if it raises their profile in younger people. Let's face it, most 17-year old kids have never heard of Yahoo!

It reminds me of this: http://en.wikipedia.org/wiki/The_Best_Job_In_The_World
Scorpio Send private email
Thursday, March 28, 2013
 
 
Was Instagram really worth $1b?

Internet business is conducted in fantasy dollars.
Jeremy Morassi Send private email
Thursday, March 28, 2013
 
 
Where do the comparisons end? $3.5 billion buyout of Lotus by IBM (for Notes for goodness sakes!).

As Scorpio highights, for an organisations Yahoo!'s size, $30m USD is pretty good for has effectively become a global publicity campaign.

Cheers -
Marcus from London Send private email
Thursday, March 28, 2013
 
 
It isn't fantasy dollars.  They are just dollars that place a high value of potential versus current performance. You can check back in 10 years to see if it was a good bet or not. For example lets look at youtube. Bought for 1.6 billion in 2006 for a company with pretty much zero revenue. Was it a bad deal? Well today Youtube brings in about 1.5 billion (estimated for analysists) in revenue with a 30% growth rate.  If they have 20-30% profit margins, that is  going to be a good investment. Or you can be someting like Draw Something where you sell out fo 180 million and then your app starts to fade away a couple months later and you realize you way overpayed for potential.

That being said I can't imagine there is much value there. Yahoo does not have a good acquistion history.


--
Was Instagram really worth $1b?

Internet business is conducted in fantasy dollars.
Jeremy Morassi 
Thursday, March 28, 2013
Foobar Send private email
Thursday, March 28, 2013
 
 
"$3.5 billion buyout of Lotus by IBM"
IBM probably made that back in less than 24 months.  You can't run a Notes server without an IT staff dedicated to nothing but.  After the Y2K  scam wound down, major enterprises started contracting out IT functions.  Today, if you don't sell IT products, it is virtually certain you have contracted with a service provider.  IBM is a service company now, not a hardware or software company, and one of the ways it gets billion dollar service contracts is by leveraging Notes.  Last year IBM had $50 billion in gross profit on $104 billion in revenue.  It's not quite as good as Microsoft's margins, but it's nothing to sneeze at.

"Yahoo does not have a good acquistion history"
Very, very true.  Yahoo buying Slummy or Jimminy Cricket or whatever this kid's web app is, is probably the kiss of death to it.  Oh well, he should have enough money now to pay for an education or open a barbershop or drink and chase women for a few years.
Howard Ness Send private email
Thursday, March 28, 2013
 
 
Interesting that his dad is a Financier and his mum a Solicitor - both rather useful "contacts" to have to help you strike a deal like this. 

I wonder if the popularity of his software alone would have been enough for him to get this deal if his parents had "ordinary" jobs.
John W King Send private email
Tuesday, April 02, 2013
 
 
A quick follow up: http://www.businessinsider.com/why-marissa-mayer-bought-a-30m-startup-2013-4

 The deal makes a bit more sense when you learn that it isn't about some app written by a kid but a technology being worked on SRI (you can google their past projects. They are about as legit as it comes for a research lab).  From the article I couldn't figure out who owned what IP wise though.

Now summarization technology still sounds pretty borderline to me...
Foobar Send private email
Thursday, April 11, 2013
 
 

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