…if I told you there was a SaaS company with organic revenues:
D15: 22.4M
M16: 23.8M
J16: 29.7M
S16: 35.3M
D16: 40.5M (up 81%)
M17: 49.1M (up 106%)
J17: 59.2M (up 99%)
Trailing revenue of about 184M…around the size of some of the smaller companies we follow on this board. Only a little less than 40% as much revenue as Shopify, but growing even faster!!!.
What would this company be worth? 4B?
Well that is the software and services business ONLY at Square.
Cheers.
Bear
I’m all for revenue growth. Really am. Always have been. But that’s just my starting point. What I want to see, in any company in which I invest, are profits as a consequence of healthy operating and profit margins. I wanna see free cash flow that culminates in share buybacks, dividends or retained earnings. I guess the bottom line is that I am, and always be, a “show me the money” kinda guy.
I’m too cynical to be a dreamer.
a “show me the money” kinda guy
This company is still in very early stages of its growth life. So you cannot measure this based on profits. Try other valuation methods.
This company is still in very early stages of its growth life. So you cannot measure this based on profits. Try other valuation methods.
What other valuation methods do you suggest? I look at investing from a fundamental perspective. You want me to invest in your company? Tell me about your profits. Oh, you’ve been in business for three years and haven’t made any money from your ongoing operations? Then explain to me how you intend to become profitable and to what extent?
When I compare these types of high revenue growth/no profits companies against the likes of UBNT or ANET, the PROFITABLE enterprises get my dollars. But, hey, that’s just me.
there is nothing wrong with that. My comment was if you are trying to value, then you need to use other methods.
I guess the bottom line is that I am, and always be, a “show me the money” kinda guy.
I’m too cynical to be a dreamer.
Hi, Jon!
Fair enough. I see your point and understand your requirements, they make perfect sense. Surely you see the other side of the coin.
I want APPL when their factory was the Gates’ family garage *
I want MSFT the day they moved out of the garage *
I want GOOG the day they designed their logo *
I want ALGN when their first prototype came out of the mold *
I want FB the day they sold their first ad *
I want NFLX when they embedded in their model a shift from DVD to streaming *
Both methods work. Some fools playing a mixed bag of tricks might even dare to mix your “must-have’s” with my “dreams.” Imagine that!
There are so many way to win, and I’m sure you will continue to do so.
Dan