Suppose you expect Facebook to grow at 50% per year. How long until you run out of internet users?
50% for the next several years is not an outrageous expectation given their 25x sales multiple. I haven't done the math because I'm both busy and lazy, but I suspect it is actually a good bit lower than what is implied by such massive multiples.
They are indeed running out of people to sign up. On the planet. That is amazing. So amazing, I would argue, that one could imagine governments getting nervous. When's the last time you saw that in a prospectus?
They won't actually run out of course, but I expect their user growth rate to rapidly approach the low single digits. Which leaves an awful lot of innovating money extraction to provide the absurdly high valuations they've asked for and gotten. Time will tell.
50% for the next several years is not an outrageous expectation given their 25x sales multiple. I haven't done the math because I'm both busy and lazy, but I suspect it is actually a good bit lower than what is implied by such massive multiples.
They are indeed running out of people to sign up. On the planet. That is amazing. So amazing, I would argue, that one could imagine governments getting nervous. When's the last time you saw that in a prospectus?