I have always been intrigued by online companies who make no money or lose money and yet are sold for millions of dollars if not more. I'm also curious as to how applications such as cell phone (and facebook) apps that are free make money. Are these companies all attempting to generate revenue through advertising? Take a 'company' like UrbanSpoon. UrbanSpoon provides a free cell phone app that gives you suggestions of places to eat. The only way I can see that this company may generate income is what may be sponsored results although in going to their website I don't see anyway I could add my restaurant (if I owned one) to these results. Somehow this company sold for millions of dollars. Is it just me or are things reverting back to the 1990's when online biz's sold for millions of dollars even though they weren't profitable? Is there something I'm missing here?
Well, a lot of times things on the surface are not as they seem. It does not always have to do with what the site is about. It is about what it has. Think 'data mining'.