Les Billets de Monocle

50 Dollars

19 July 2021

Fifty dollars is the average price paid per user for big tech acquisitions.

Here are the details:

  • 2006: Google buys YouTube for $1.7 Billion with 50M users or $33 per user.
  • 2011: Microsoft buys Skype for $8.5 Bn with 145M users or $58 per user.
  • 2012: Facebook buys Instagram for $1.0 Bn with 30M users or $33 per user.
  • 2014: Facebook buys WhatsApp for $19.0 Bn with 470M users or $48 per user.
  • 2016: Microsoft buys LinkedIn for $26.2 Bn with 467M users or $56 per user.

Average: $47 per user, I'm rounding to $50. It is interesting to see that this figure is relatively stable between the different transactions, while it takes ten years between the first and the last (minimum $33, maximum $56).

Here is now the value attributed by the market to the newcomers in the sector and their users (taking the closing prices of Friday 16/07/2021) :

  • Snapchat: a valuation of $92bn for 280M users or $329 per user.
  • Twitter: a valuation of $54 billion for 200M users or $231 per user.
  • Pinterest: a valuation of $45 billion for 190M users or $236 per user.
This new average is at $265, which is six times the fifty dollars we were talking about above.

No comment and have a good week,


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