2 million downloads.
$125 - $175 paid per download.
Jesus.
$125 - $175 paid per download.
Jesus.
All of this makes me wonder what kind of financial trick is under that deal. Any proficient VC that could explain what could be going on here ?
EDIT: the stats are 4 millions users not two. But that's still 70$ per download .
- Does the company need it to survive or succeed?
- Can the acquiring company better monetize or grow the asset?
- Are the growth trends exponential, such that a huge amount of other people may soon be using the product?
- Is there some strategic advantage to the team - or product category expertise?
- Is the product easily defensible? (e.g., strong network effects)
I can't speak to this particular acquisition, but there are a number of examples where heavily "overpaying" may actually be a steal in the long term (and of course, the opposite).