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Saturday, October 15, 2005
The Weblogs/AOL deal values blogs at $600 to $900 per inbound link. While I do not find any great repeatble pattern for valuation that can be culled out from here, I agree with Fred Wilson that these numbers may be some sort of guidepost to monitor the investment thesis and make sure the opportunity is playing out the way investors think it will. Web based businesses are centered on content and related data and the management team and investors need to monitor that data closely to keep a handle on the business and its progress. Fred Wilson writes that his form would like to make initial investment sometime between the formation of a business and the first dollar of revenue coming in the door.Even after revenue starts rolling in, alternative metrics help in monitoring the growth and health of a business – essentially different metrics for different type of enterprises.
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