some WISP needs to go on shark tank, just to see what they say
On Mon, Jan 6, 2020 at 11:08 AM CBB - Jay Fuller <par...@cyberbroadband.net> wrote: > > Good discussion. I'll have to play with some numbers > > > ----- Original Message ----- > *From:* ch...@wbmfg.com > *To:* AnimalFarm Microwave Users Group <af@af.afmug.com> > *Sent:* Monday, January 6, 2020 10:33 AM > *Subject:* Re: [AFMUG] Company Valuation > > Revenue has no bearing on value. Say you have $1 billion in revenue but > are spending $2 billion to provide the service thus requiring an additional > billion from investors each year. What is the value of that company? > Think Movie Pass. Think Uber. Lots of public companies run at a loss > hoping to eventually become profitable. > > There are multiple methods of valuing a company. > The most common is the earnings multiple. Or Multiple of Cash Flows. > > 5X EBIDTA > > What is your net income (minus depreciation, taxes and financed equipment > payments). Basically gross profit minus SG&A expenses. Multiply that by > 5 and you have a starting point. In other words, how much cash is it > throwing off. What is the earning power of the company. > > You can also do a discounted cash flow method/net present value based on > future cash flows. Say I give you $1M for your company and it runs in the > same manner that it has been running. What is my annual rate of return on > that investment? And you must account for depreciation and taxes and > interest and equipment payments etc when doing it in this manner because > your assets are worth less money each year. At the end of the period you > use (say 10 years) did you get a decent return on the investment and is > your principle still intact? > > *From:* CBB - Jay Fuller > *Sent:* Monday, January 6, 2020 8:07 AM > *To:* af@af.afmug.com > *Cc:* memb...@wispa.org > *Subject:* [AFMUG] Company Valuation > > > Lets say for easy math purposes you bill approximately 1.5 million > annually. > > I've heard 1.5 times annual revenue thrown around for a valuation > purpose. There is a lot more to this figure but it's a place to start. > > So, if your company billed 1.5 million, you'd say your valuation was > around $2.25 million. > > If you had 90 towers on your network - and you owned 60 of them (the > steel, not the land they're on) , would you consider your network > worth more than if you rented all 90? > > My take on this is yes, they could all be taken down and converted to > cash, so the fact we own towers vs. rent them makes our network > more valuable. > > What say you? > > Thanks. > > > > ------------------------------ > -- > AF mailing list > AF@af.afmug.com > http://af.afmug.com/mailman/listinfo/af_af.afmug.com > > ------------------------------ > > -- > AF mailing list > AF@af.afmug.com > http://af.afmug.com/mailman/listinfo/af_af.afmug.com > > -- > AF mailing list > AF@af.afmug.com > http://af.afmug.com/mailman/listinfo/af_af.afmug.com >
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