How did they Valuate it at $140 mil?

Discussion in 'Google' started by NewTier, Jul 22, 2008.

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  1. #1
    When google bought the Russian Ad Agency Begun for $140 million, they were buying over 50% of the market share in the $225 million contextual market.

    My question is; if Begun made only $10 mil per year, how can google pay almost 14x yearly revenue?

    How did they valuate it at $140 mil?

    If they offered only $30 million, would Begun have sold their company?

    I don't understand this.
     
    NewTier, Jul 22, 2008 IP
  2. desilator

    desilator Peon

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    #2
    Rights to the company names.. property.. just my guess.
     
    desilator, Jul 22, 2008 IP
  3. NewTier

    NewTier Notable Member

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    #3
    Yes but what can they do with the company names? What property might they have?
     
    NewTier, Jul 22, 2008 IP
  4. Limotek

    Limotek Peon

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    #4
    I think it could be intangible assets such as reputation, customer base, website traffic, goodwill payments, etc. although 14x is still very high. Maybe because google was the buyer, the price was overly inflated as they know they can afford it.
     
    Limotek, Jul 22, 2008 IP
  5. dairyman

    dairyman Notable Member

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    #5
    They are part of the trade secrets and should not be discussed in public forums like this one. :p
     
    dairyman, Jul 22, 2008 IP
  6. harsha22

    harsha22 Guest

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    #6
    Russia is a riddle wrapped in a mystery inside an enigma. Hence difficult to know what exactly happened..:)
     
    harsha22, Jul 22, 2008 IP
  7. skillipedia

    skillipedia Well-Known Member

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    #7
    Same as FaceBook. Last year, it made no more than $300mil profit knowing that its price tag reached $15bn.
     
    skillipedia, Jul 22, 2008 IP
  8. SEO_WatchDog

    SEO_WatchDog Well-Known Member

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    #8
    With russian oil magnats doubling every year - Google is lucky to dodge to buy it at this price...
     
    SEO_WatchDog, Jul 22, 2008 IP
  9. NewTier

    NewTier Notable Member

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    #9
    Why do you say so?
     
    NewTier, Jul 23, 2008 IP
  10. sb1982

    sb1982 Peon

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    #10
    In russian market Google have very strong competitor- Yandex. And then Google bought Begun, they followed other interest also - to aquire entire market in future. so thery are fighting over the bridgeheads here ;)
     
    sb1982, Jul 23, 2008 IP
  11. misch.chief

    misch.chief Active Member

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    #11
    I would say that Yandex definitely have a influence in why they have paid so much....and I would also because it is Google.
     
    misch.chief, Jul 23, 2008 IP
  12. NewTier

    NewTier Notable Member

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    #12
    What did Yandex do?
     
    NewTier, Jul 23, 2008 IP