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TikTok’s potential $588 per user valuation in Microsoft deal

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Re: TikTok’s potential $588 per user valuation in Microsoft deal

#11

Post by rtx »

seven4 wrote: post #3

“At a market cap of $755 billion (at point of writing) Facebook’s per user value is around $288. If Facebook is some leading indicator for the pinnacle of per user value for social media, then at $50 billion for the roughly 85 million American users, TikTok’s per user value would be $588.” I think facebook would pay a hefty premium even above that; handing Microsoft a buzzing social media platform on a silver platter…

I would have preferred if Facebook bought TikTok. It would have been easier to run ads.

Re: TikTok’s potential $588 per user valuation in Microsoft deal

#13

Post by seven4 »

robjan wrote: post #7
seven4 wrote: post #3

“At a market cap of $755 billion (at point of writing) Facebook’s per user value is around $288. If Facebook is some leading indicator for the pinnacle of per user value for social media, then at $50 billion for the roughly 85 million American users, TikTok’s per user value would be $588.” I think facebook would pay a hefty premium even above that; handing Microsoft a buzzing social media platform on a silver platter…

Microsoft are one of Facebook's investors, although a relatively small one.

Yeah, i guess full ownership gives them all the upside/control/ability to integrate with their other projects/ambitions.

Re: TikTok’s potential $588 per user valuation in Microsoft deal

#14

Post by hanniabu »

bearjaws wrote: post #9

The only thing is, TikTok will be an amazing advertising platform for the up and coming Gen Z. I do believe its an absurd price though, Facebook is around $288 per user vs $588 here. If a platform that is very good at making money from Millenials, Gen X and even Boomers (all of these generations are established in their careers, and have far more money than Gen Z) is $288 per user how is this ever going to pay off?

Facebook has lost its muster. Instagram would probably be a better comparison now.

Re: TikTok’s potential $588 per user valuation in Microsoft deal

#15

Post by michaelmior »

oefrha wrote: post #10
Abishek_Muthian wrote: post #4

Earlier quoted context omitted.

>Facebook and Google probably are out because of fear the sale will be disallowed because of their market dominance. Facebook okay, Google is not even a player in social networking unless you are referring to YouTube, since it is a video platform. But I feel, fear of competition laws is not the major delimiter in the whole Tik-Tok sale fiasco; This is state initiated after all.

Player or not I hope YouTube take a page from TikTok. Their recommendation algorithm is abysmal (my opinion of course, and the opinion of many people I've talked to; anecdata, but given that I've never heard anyone saying they're hooked on YouTube recommendations, while I've heard tons of people hooked on TikTok's, I'd say there's at least some truth in this claim) and hasn't seemed to improve at all for the past, I…

I think part of what makes TikTok recommendations addictive is that since the content is so short, it's harder to get fatigued by bad recommendations. If I get recommended just a couple bad YouTube videos that are several minutes long even if I abandon partway through, it's easier to give up.

Re: TikTok’s potential $588 per user valuation in Microsoft deal

#16

Post by oefrha »

bearjaws wrote: post #9

The only thing is, TikTok will be an amazing advertising platform for the up and coming Gen Z. I do believe its an absurd price though, Facebook is around $288 per user vs $588 here. If a platform that is very good at making money from Millenials, Gen X and even Boomers (all of these generations are established in their careers, and have far more money than Gen Z) is $288 per user how is this ever going to pay off?

I guess one thing to consider is that Facebook MAU is declining while TikTok is on the growth track.

Also, the 85m users of TikTok considered here are all U.S. users, who on average must be (potentially) more valuable than the average Facebook user.

Re: TikTok’s potential $588 per user valuation in Microsoft deal

#17

Post by jjirsa »

simplertms wrote: post #8

The most interesting thing about this deal outside the obvious political drama in my opinion is that this will change Big Tech landscape overnight. Microsoft has done enterprise so well for so long but has always struggled on 'consumer tech' outside of its Windows OS. Acquiring a social media platform is going to catapault it into the heart of consumer tech. Question is will TikTok be a parallell arm or will it help…

Who created this lie that Microsoft struggled with consumer?

Xbox was always consumer and is massive. A huge chunk of the Windows line was always about consumers. The office line straddled both. Hotmail was consumer first.

Re: TikTok’s potential $588 per user valuation in Microsoft deal

#18

Post by jariel »

simplertms wrote: post #8

The most interesting thing about this deal outside the obvious political drama in my opinion is that this will change Big Tech landscape overnight. Microsoft has done enterprise so well for so long but has always struggled on 'consumer tech' outside of its Windows OS. Acquiring a social media platform is going to catapault it into the heart of consumer tech. Question is will TikTok be a parallell arm or will it help…

" Acquiring a social media platform is going to catapault it into the heart of consumer tech."

It will catapault one of their subsidiaries into the heart of that.

Remember they used to 'own the world' through IE, very much a consumer product, and that didn't shape them.

They own Skype, one of the world's most prominent p2p communication tools, and screwed that up.

Re: TikTok’s potential $588 per user valuation in Microsoft deal

#20

Post by propter_hoc »

I can't believe I'm the first to point this out, but this article is kind of obviously wrong.

The analysis in the article is like looking at Tesla on an earnings per share basis, when it's actually heavily priced on forward projected earning potential.

Like Tesla, Tiktok is a growth stock. This valuation doesn't reflect its current value per user - it's baking in an implied doubling or trebling of its user base in some short time span.

I'm not saying that the assumption that Tiktok will meet its projections (and justify this valuation) is warranted, but I am saying that comparing Tiktok's $/user to Facebook, a mature/somewhat stagnant social network, is the wrong way to look at this.

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