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Comment by sinzone | Hacker News Reader

dude, in just two months.. still amazing.

It's mostly irrelevant, honestly, except as good marketing. If I buy $1000 worth of candy and sell it for $1000 every month, do I have a "$12,000 run rate?"

I'm not poo-pooing FOBO, only saying that "$X run rate" is meaningless without understanding the underlying economics. It's a vanity metric.

So, it's awesome they got ink based on that story, but let's not kid ourselves that this says something about the business in and of itself. :)

> If I buy $1000 worth of candy and sell it for $1000 every month, do I have a "$12,000 run rate?"

Yes. As far as I know, "run rate" refers to taking data from a shorter time period and extrapolating it to a year, and the obvious implication is that revenue is the data point being extrapolated.

You're either being deliberately pedantic or missing my point, which was to illustrate how silly "run rate" can be as financial metric unless it's backed up by fundamentals. The $1000/month candy business is a bad business and in fact the more revenue it "makes" the more money the business actually loses.

No one is disputing that this one figure doesn't give a complete representation of the health or success of a company. That doesn't mean that run rate can't be a useful metric. You just asked if you were correct about the definition of run rate, and I just responded that you were.

Deliberately pedantic. Got it.

No, not pedantic. It's the standard and widely-accepted definition of the term "run rate."

Yes, I know what it means. Thanks for your help.

I feel the need to inform you what the word "pedantic" means, but that would run the risk of again being accused of pedantry.

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