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Comment by alegrn | Hacker News Reader

Here is some math:

The formular for the present value of a perpetuity is just

  present_value :=  cashflow / discount_rate

Given 750$ per month (9000$ per year) and a 3% annual discount rate, then an infinite stream of 750$ monthly payments is worth today 300.000$.

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The computer gaming market doesn't function like most other markets; the idea of considering that monthly income as recurring indefinitely is rather odd.

Of course, You are absolutely right. The author said he had no idea how to value his work and I was thinking... Hmm, he might try to use financial math formulas such as the NPV as help. If the game makes $9000 profit per year at a discount rate of 3% you could value it:

    $8738 ... (makes profit for N years, where N = 1)
    $17221 ... (makes profit for N years, where N = 2)
    $25458 ... (makes profit for N years, where N = 3)
    $41217 ... (makes profit for N years, where N = 5)
    $76772 ... (makes profit for N years, where N = 10)
    $133897 ... (makes profit for N years, where N = 20)
    $284390 ... (makes profit for N years, where N = 100)

And no software is able to make profit for 100 years.

(disclaimer: my calculation might of course be wrong, I didn't put much thinking into it)

There are few who can make this happen. If you're not minecraft or a subscription/in-app-purchase game, you're out of luck.

It's so totally not suspicious that an account that hasn't posted for over a year all of a sudden pops up to make a post in support of the author?

Nope, my post was just meant as some random fact. You can easily put a price on an infinite stream of constant payments. I don't believe the project is able to generate an infinite stream of 750$ payments. But if it could, that would be roughly it's value.

By the way, for an investor it does not matter how much effort (1 year, 5 years, 100 years) the author did put into the project. For the present value of the project only matters what monthly payements there will be. If someone can forecast these payments, he can also put a price tag on the project.

So it might also be, that there is no more interest in the game in one or two months ... then it would be roughly worth 0$ to 750$ (even if it took much effort to implement it).

You probably also want to revise your discount rate assumption.

Sure. The given assumed discount rate of 3% was just meant as an example.

Huh? You are questioning the commenter's sincerity just based on how often they want to post a comment on HN. Witch-hunting does not really make HN a better place.

Are you accusing the author of using a sockpuppet account to...give himself financial advice?

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