Seattle Central Library Photostroll

image Today the Seattle area was greeted with good weather.  Of course, the local Flickr meetup group had pre-planned a photostroll that, of course, was inside. 🙂 We wandered about the downtown Seattle library for approximately 2 hours, taking pictures of the awesome architecture and colors of the building.  My photos are here.

Also, got the first bike ride of the season under the belt today.  One week until Tour de Lopez!

25x revenue is a company valuation? Huh?

I was reading the article by Mark Evans that laid out how Flickr could have an independent valuation of $4 billion dollars.  He used a multiplier defined by Henry Blodgett in determining the value of Facebook: 25 times a company’s annual revenue is their valuation.

Wow.

I decided to apply this to a few other companies that have been in the news lately: Yahoo!, Microsoft, and Google.

Based on 2007 10K filings for each company:

Company Annual Revenue Valuation Market Cap (as of 5/8/2008)
Yahoo! $6.425B (2006) $160.625B $36.08B
Microsoft $51.122B (2007) $1.278T $272.60B
Google $16.593B (2007) $414.825B $182.92B

This gives between 2.5 and 4.5 of over-estimate in independent publicly traded companies.  I’m not a finance guy, but it seems like that 25 times number is quite a stretch, to me.