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Zapier reached a $5B valuation with $1.3M of funding

forbes.com

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Re: Zapier reached a $5B valuation with $1.3M of funding

#251

Post by specialist »

superbcarrot wrote: post #29

Sometimes I get shocked by these numbers and it reminds me how little I know about business. Like if you showed me the wikipedia page for Zapier and asked me give it some value, I would be way off. Or if you pitched the business idea to me, I would tell you do something better with your time.

Word.

IIRC, Microsoft acquired CompareNet for $400m in 1999. Scripts for scrapping prices. Written in Perl.

I always get stuck on the little questions. Like: Does it work? Is idea worth doing? How big is the market?

(I mention CompareNet because I had some contact with one of the founders. It's my IRL example that I never figured out how to play this game.)

Re: Zapier reached a $5B valuation with $1.3M of funding

#252

Post by supernovae »

NiceWayToDoIT wrote: post #225
supernovae wrote: post #69

Earlier quoted context omitted.

IFTTT kinda gave up in comparison to Zapier - zapier has so many api/service/framework/tool interfaces where IFTTT kinda just went niche with home automation and basic stuff beyond that. For example, with IFTTT the RSS trigger is pretty stupid but with zapier you can trigger based on parsed fields with values and triggers on those values... I had hoped that Zapier would put some pressure on IFTTT to do more but it se…

But what is the price justification: Zaphier $599 per month vs. $3.99 per month for IFTTT ? I know that IFTTT is a quite long on the market, do not know about functionality comparison. https://zapier.com/pricing Even cheapest Zapier plan is $19.99 per month.

Yeah, but i'd expect IFTTT would at least have smart filters and such - there is no excuse you can't parse and filter RSS...

Re: Zapier reached a $5B valuation with $1.3M of funding

#253

Post by nickfromseattle »

holistio wrote: post #221
nickfromseattle wrote: post #193

As a non-technical founder my company pays Zapier thousands of dollars per year. We've automated a lot of tedious, manual tasks that you would typically assign a VA. I think we save some money, but even if it was break even, or more expensive than manual labor, the mental overhead of not managing another person, wondering whether the tedious work was done, and according to specification justifies the cost.

Can you give examples of stuff that Zapier does for you that a VA would do? In my mind Zapier does things that a junior developer or maybe an office admnistrator would do, not an assistant. I feel like there is a small, but significant difference.

We publish a lot of content.

Previously we had a virtual assistant:

1. Create a Google Doc

2. Title it according to a specific standard

3. Copy/paste information into it

4. Make the link publicly shareable

5. Update our CMS with the link to Google Docs

6. *1,000

This work sucks, and it's much easier to depend on a machine than hiring, training, documenting, managing, QAing someone to work in a bad job.

Re: Zapier reached a $5B valuation with $1.3M of funding

#254

Post by reducesuffering »

valuearb wrote: post #230
reducesuffering wrote: post #38

Earlier quoted context omitted.

No, it's not, because that isn't enough information to determine your conclusion. That's a 36x P/S ratio. Many established public companies are at or exceeding that, like Cloudflare and Crowdstrike. (those companies COULD be overvalued too, but it depends on something else) The most important factor or metric you're missing from the equation is growth (assuming eventual profit margins are normal). It doesn't matter w…

Virtually all of the companies trading north of 30x sales are ridiculously overpriced. It’s just a bubble, don’t allow it to distort what long term values really are. Amazon and Cisco were similarly overvalued in 2000. It took Amazon 7 years to trade back to that price. Cisco never has.

I'm going to assume, based on your outlook and name, you're a traditional value investor. I consider myself one too, and have read Margin of Safety, Buffet, and Intelligent Investor.

Companies north of 30x sales are generally overpriced, but that metric alone is still woefully inadequate to determine true NPV of future earnings. Software co's can afford higher P/S for their true value because of the unprecedentedly high margins they're able to achieve and reap as profit once operating expenses are managed. There's a reason BRK bought Snowflake. Amazon was still a great purchase in 2000 because what ultimately matters is the long term value. You can bet that you'll get more value by buying at a cheaper price later on, but that may ultimately never happen. Knowing that AMZN would be where it's at in 2021, buying it in 2000 is the right choice without 20/20 hindsight of market conditions. Same is true of high value companies like Cloudflare and Fastly. There may be interest rate increases or other reasons they become further discounted in the next 5 years. However there's more a chance that they're true value is adequately discovered while one stays on the sidelines. The margin of safety for them is great and of course we'll be free to see after a few plus years.

I also wouldn't bet on interest rates rising (or falling). Market consensus for their current price is usually pretty good and there are many reasons why interest rates are historically low and likely to remain roughly so.

Re: Zapier reached a $5B valuation with $1.3M of funding

#255

Post by narrator »

daniellarusso wrote: post #181
narrator wrote: post #103

Earlier quoted context omitted.

>Sometimes I get shocked by these numbers and it reminds me how little I know about business. This is because you lack the most overlooked and most difficult to teach skill in investing: empathy. Zapier lets non-programmers, the vast majority of the planet, do things that programmers do. Many programmers have poor empathy and thus make bad salespeople and investors. If you can understand how most of the planet thinks…

Twitch started from Justin.tv, so it was not really about videogames originally. But, if you think about how professional sports is and could foresee the rise of e-sports...

It's kind of like the rise of live electronic music. Oh there aren't any feats of manual dexterity like playing the guitar or drums well, but people go to see electronic musicians perform anyway.

Re: Zapier reached a $5B valuation with $1.3M of funding

#256

Post by valuearb »

reducesuffering wrote: post #254
valuearb wrote: post #230

Earlier quoted context omitted.

Virtually all of the companies trading north of 30x sales are ridiculously overpriced. It’s just a bubble, don’t allow it to distort what long term values really are. Amazon and Cisco were similarly overvalued in 2000. It took Amazon 7 years to trade back to that price. Cisco never has.

I'm going to assume, based on your outlook and name, you're a traditional value investor. I consider myself one too, and have read Margin of Safety, Buffet, and Intelligent Investor. Companies north of 30x sales are generally overpriced, but that metric alone is still woefully inadequate to determine true NPV of future earnings. Software co's can afford higher P/S for their true value because of the unprecedentedly h…

Amazon stock price dropped over 90% in 18 months after March, 2000. There is no excuse for not doing basic valuation estimates, it can save you from these collapses. You can still love Amazon’s business on 2000, but not overpay for it, just as you can do same with Tesla today.

And the Fed is at zero percent. Name another period where zero percent rates ever existed, and how long did it last? When the money supply has grown 50%+ over the last year how are we avoiding inflation, and if inflation kicks up how are we avoiding higher interest rates?

Re: Zapier reached a $5B valuation with $1.3M of funding

#258

Post by ineedasername »

valuearb wrote: post #235
ineedasername wrote: post #32

Earlier quoted context omitted.

30x revenue multiples are actually not too uncommon, especially for a SaaS firm that appeals to both small & enterprise customers, is already profitable, and has a large addressable market. Here's an article that has a frequency chart based on valuation multiples. Keep in mind that, while it's front-loaded with lower multiples, not all business models have the same potential for revenue growth: https://onstartupexits…

30x revenues is a marker for an excellent short position. Revenue growth always slows and almost never justifies such ridiculous valuations.

Sure, though I was just saying these valuations aren't too uncommon. Still, in Zapier's case, they're in hockey-stick revenue growth, and accelerating. It's still a gamble, but not an unreasonable one to believe they'll ultimately justify the $5B valuation. Of course by that point they've be valued at some other ridiculously high number.

Re: Zapier reached a $5B valuation with $1.3M of funding

#259

Post by daniellarusso »

narrator wrote: post #255
daniellarusso wrote: post #181

Earlier quoted context omitted.

Twitch started from Justin.tv, so it was not really about videogames originally. But, if you think about how professional sports is and could foresee the rise of e-sports...

It's kind of like the rise of live electronic music. Oh there aren't any feats of manual dexterity like playing the guitar or drums well, but people go to see electronic musicians perform anyway.

There was an interesting discussion on /r/DJs, about electronic music performances in the late 90s and early 2000s.

One of the comments articulated that the focus was on the music, not the DJ’s performance, and often times the DJ was not clearly visible, nor intended to be.

Another commenter pointed out that as an electronic music producer nowadays, the only way to present your music, as you also pointed out, is to DJ in front of a crowd.

Don’t underestimate a good DJ, though.

But, it was also pointed out that not all good producers are good DJs and vice-versa.

It is also worth mentioning that Twitch has become an increasingly popular venue for DJs to livestream during quarantine. Ephemeral live performances to reduce copyright infringement penalties are the norm.

Interesting times.

Re: Zapier reached a $5B valuation with $1.3M of funding

#260

Post by mooreds »

monoideism wrote: post #127
mooreds wrote: post #62

Earlier quoted context omitted.

I'll tell you about the first time I started using Zapier. I wanted to move some data from google spreadsheets to some other system (I don't actually recall what it was, it was 2012). I was on a team of three devs supporting a business critical application. The options for me were: * bump something else to have a dev build out the integration * pay the monthly fee to enable a non technical person to build the integra…

> pay the monthly fee to enable a non technical person to build the integration I'm just curious how that went. Was a non-technical person able to learn Zapier enough to carry out the task? Were they totally non-technical, or just not a professional dev?

They were able to do what needed to be done. I'm not sure what you mean by totally non technical? They weren't developers, but knew how to use gmail and google sheets at a pretty sophisticated level.
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