
On Twitter: What's Valuation Got to Do With Revenue? - mgcreed
http://www.readwriteweb.com/archives/on_twitter_whats_valuation_got_to_do_with_revenue.php
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JacobAldridge
Valuing a business is like valuing a house. 1) If you have multiple buyers,
you can usually sell for a higher price. 2) There are some features (add that
new bathroom) which will increase the price you achieve, and 3) It's possible
to overcapitalize on features that have less value than it costs to add them.

Revenue, and particularly the combination of profitability and cashflow
positivity, is likely to attract more buyers, therefore increasing value 1).

But a business needs to do something to increase revenue. Twitter and Facebook
are both aiming to do 2) ... and running the risk of doing 3).

