
How to measure the profitability of a startup? 3 simple methods. - szczupak
http://www.businesshackers.com/2007/06/01/what-do-you-absolutely-need-to-start-a-startup/
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danielha
Those are just some generic and basic return ratios and much less relevant to
the size of most of these web startups.

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yubrew
^ Agreed. Most businesses determine their worth from net present value,
comparable sales, or capitalization rate based on net operating income.

A problem with these web start ups is that they often don't have substantial
income, and often do not have comparable sales. Two years ago, who honestly
thought that $500mm for MySpace turned out to be a bargain?

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szczupak
Danielha NPV, IRR are good measures too, but I think 90% of investors still
use ROE, ROI, ROA etc.

