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November 13, 2008

Valuing Dotcoms in Today's Environment

Alok Mittal has triggered a discussion on VentureWoods on valuing Internet start-ups in the current environment when the enterprise value of a leading listed player like Rediff.com is just $24 million.
As a bellwether for Indian internet industry, these numbers reset expectations on the entire sector and near term expectations. Naukri is just over $200M on EV, which I do believe is healthy because of their earnings (P/E ~ 20).

I also wonder what series B valuations for Internet companies would be now - till 12 months back, companies with less than 200K users and zero revenues were getting $24M valuations…

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of information and networking services to the private equity and venture capital ecosystem in India. View free samples of Venture Intelligence newsletters and reports. Email the author at arun@ventureintelligence.in