Digg, is a very popular social bookmarking website that reports 20,000,000 visitors per month, and according to Compete.com (Tracks Web Visits), they receive 22,500,000 visitors per month.
The assumptions are that Digg.com earns $3 Million a year in revenue, and that they have 20,000,000 visitors per month.
Meaning they earn 14 Cents per user per Month, which is TERRIBLE!
People Say that Digg is currently being looked at for roughly $200 Million, which is 67x Annual Revenues. Meaning that if a company were to purchase Digg for $200 MM, then it would take them 67 years to recoup their investment back. You can earn more in a Money-Market Account or a CD.
-(Plus, this doesn’t even take into account their Net Revenues, which are unknown, that puts that 67x higher. Some say the business is Break even)
Would you purchase an Investment that gives you nothing back, but the hopes that you can, because you reach a huge payout? Or is this just another YouTube Hype Deals that provides little for the acquiring company?
-Let me know what you think, Please Comment and tell me what you think? Is Digg worth the price or isn’t it? And if it is, why hasn’t it been acquired yet?
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