8/10/2023 0 Comments Vox media net worth![]() ![]() ![]() “With revenue growth and margin improvements, in 12–24 months, what is our effective multiple going to be? We push ourselves to be at 5x EBITDA” as a percentage of revenue.”īuyers also focus on how fast a company is growing. “When we think about M&A it’s less about what the business is today and more about what are we going to be able to do with the business,” says Vivek Shah, the CEO of Ziff Davis who has overseen multiple media acquisitions. They want to know not just the current EBITDA as a percentage of revenues, but also what they might do to improve on it.Ĭan they cut expenses from combining back end operations like bookkeeping or human resources? They might look to see what new profits they can add through new revenue streams. Sophisticated strategic buyers look much deeper. Most digital media companies sell for about 8–12x EBITDA. They often have formulae for the multiple they’ll pay over that profit, usually operating profit expressed in terms of its proxy, EBITDA.ĮBITDA, short for “earnings before interest, taxes, depreciation and amortization,” measures how much money is left after the “real” expenses - things like salaries and office rent - are paid but before any financial and tax wizardry that can make the reported income, a.k.a. Many buyers demand their acquisition targets be profitable. Should a media company with a predicted $10 million in yearly turnover sell for $30 million (3x revenues) or $70 million (7x)? A number of key factors can push the price to either end.Īs many of the most-hyped tech companies have shown, taking in money doesn’t necessarily mean making any. Looking ahead, prices paid tend fall between 3–7x the predicted forward revenues for the upcoming 12 months. Digital media companies tend to sell for between 2.5 and 5 times (2.5–5x) revenues from the previous, or “trailing,” 12 months.īuyers, not surprisingly, are motivated by how much money they believe the company is going to make. ![]() Read on to learn what we’ve found.Ī lot of discussions around a media company’s valuation start with a multiple of its revenue. There have been rumors that Buzzfeed or Vox could IPO, but until they do go public or get acquired, their reported sky-high valuation numbers are largely theoretical. Surprisingly, there is not one IPO of a major digital-first editorially driven media company, so selling is the only type of liquidity event on which we can base our analysis. We’ve gleaned the ones below from research, our experience and interviews with more than two dozen media buyers, publishers, sellers and financiers. The discussion does have to start somewhere, though, and there are parameters. Yet, arriving at a definitive dollar figure can be a painstaking effort that encompasses a raft of factors which fluctuate based on everything from cash flows to psychology. How much is a digital media company worth? That is a question that a lot of us have been grappling with as lots of these companies have raised anywhere from a few million to hundreds of millions in venture capital.įor publishers, their investors and potential acquirers, the question is crucial, as illustrated by a raft of recent coverage, analysis and “ struggles.”įor even small companies with a handful of employees, fractions of a percentage change in a valuation can mean hundreds of thousands or millions of dollars difference in the ultimate payday. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |