This is a good question to know the answer to: A substantial portion of the valuation of early stage startups is not their user/engagement/revenue numbers, it is the discounted value of the uncertainty of growth of those numbers until future checkpoints. This decays over time.https://twitter.com/rishmishra/status/1161045335969546241 …
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A lot of the angst about startup valuations is a commingled business and aesthetic judgement that professional investors are overpricing uncertainty and that this overpricing carries with it a moral claim that the uncertainty is “worth more” than other businesses/other pursuits.
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Worth more at exit or priced higher going in?
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Price as of initial offer into ~same funding market at approximately same time.
End of conversation
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I think in this case Yahoo was also trying to buy the luster of a high growth start up to kickstart their brand again.
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