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Tim Armstrong: We Got TechCrunch

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Re: Tim Armstrong: We Got TechCrunch

#111

Post by dirtyaura »

brown9-2 wrote: post #90
alain94040 wrote: post #57

Earlier quoted context omitted.

There clearly is some kind of earn-out, meaning that the founders get the whole money only if they stay long enough and/or if the business remains healthy. On stage, Mike Arrington mentioned that he'd stay for sure on board for 3 years, due to "incentives." So it's possible that the sale price is $25M upfront, with another $25M in 3 years. That would make both sources (one that says the price was only $25M, and one t…

are earn-outs usually that high (compared to the up-front purchase price)?

50% is quite standard for team acquisitions to my knowledge. However, for TechCrunch earn-out sounds quite high.

I'm also surprised of the price, it seems low compared to many tech acquisitions. TechCrunch has a lot of eyeballs, even if it doesn't have main stream audience.

Midsize Finnish regional newspaper companies have market caps around €180M. TechCrunch, a major international tech publication with millions of readers, is worth of only 10-25% of a local newspaper with audience of 300000 people? WTF? Either newspaper valuations are absurd, or internet advertising and tech events are a failure as a business model.

Re: Tim Armstrong: We Got TechCrunch

#112

Post by ericd »

poet wrote: post #63
jpwatts wrote: post #59

Earlier quoted context omitted.

You seem to be confusing what is "fair" with what is "legal."

Agreed, but it's your job as a citizen to try and pay exactly what you owe by law. If what Arrington did was legal, it wasn't wrong of him. No one should be paying more taxes than what's legally required. If there are any loopholes (so to speak), it's the role of the citizens to "exploit" them and the role of law makers to close them if necessary.

If there are any loopholes (so to speak), it's the role of the citizens to "exploit" them and the role of law makers to close them if necessary.

That's a pretty bad attitude to have, that citizens should be trying to exploit as many loopholes as possible. That sets up citizenry vs. govt. as a competitive game, which is a great recipe for making something that's supposed to be cooperative become dysfunctional and complex.

It's an impossibly complex task to make a perfect airtight literal codex of laws in a system, and it's not reasonable to assume that humans can create such without introducing a huge number of contradictions, etc. We need to keep in mind the spirit of the law in order to keep our system from devolving into a morass.

Re: Tim Armstrong: We Got TechCrunch

#114

Post by count »

ericd wrote: post #112
poet wrote: post #63

Earlier quoted context omitted.

Agreed, but it's your job as a citizen to try and pay exactly what you owe by law. If what Arrington did was legal, it wasn't wrong of him. No one should be paying more taxes than what's legally required. If there are any loopholes (so to speak), it's the role of the citizens to "exploit" them and the role of law makers to close them if necessary.

If there are any loopholes (so to speak), it's the role of the citizens to "exploit" them and the role of law makers to close them if necessary. That's a pretty bad attitude to have, that citizens should be trying to exploit as many loopholes as possible. That sets up citizenry vs. govt. as a competitive game, which is a great recipe for making something that's supposed to be cooperative become dysfunctional and comp…

I'd argue that complexity is what causes loopholes, rather than the other way around. Things like tax credits aren't 'loopholes' - they're specifically codified in the law for people to utilize, in an attempt to encourage certain behaviors.

It's not gamesmanship, although there is some competitiveness between state tax laws (such as this WA vs CA capital gains thing).

That's WA's incentive to get people with lots of money to come live (and hopefully spend) it in WA. CA has enough people with lots of money that it can afford to take a different stance.

Re: Tim Armstrong: We Got TechCrunch

#115

Post by pmjoyce »

adammichaelc wrote: post #108
pmjoyce wrote: post #75

Earlier quoted context omitted.

Would a sale in that region make Techcrunch a "dipshit company" in Arrington's parlance? http://www.avc.com/a_vc/2010/07/lead-investors-dipshit-compa...

It wasn't Arrington who said that. He was quoting VC's who had said that. There’s a worry among venture capitalists, [Arrington] said, that angels are training “an entire generation of entrepreneurs who are building dipshit companies” that sell to Google for $25 million. In fact, that criticism might be extended to Y Combinator as well, which could be seen as “the king of the dipshit companies.” Arrington said he isn…

Point taken; he was quoting an unnamed VC who said that and he believes there's a kernel of truth in it. He's also been characterised as supporting that point of view; on stage yesterday Chris Sacca straight out placed "his" words feet and he didn't take the opportunity to refute it:

MA: No one is talking about the entrepreneurs.

CS: That’s not true. You call some smaller companies “dipshit” companies, but they’re not.

http://techcrunch.com/2010/09/27/the-panel-thats-definitely-...

Another quote from VentureBeat: "TechCrunch Editor Michael Arrington, who moderated the panel, had previously criticized some angels for funding “dipshit companies” that think too small and aim to be acquired by Google for around $20 million"

http://venturebeat.com/2010/09/27/angel-investors-defend-sma...

Re: Tim Armstrong: We Got TechCrunch

#116

Post by borisk »

dirtyaura wrote: post #111
brown9-2 wrote: post #90

Earlier quoted context omitted.

are earn-outs usually that high (compared to the up-front purchase price)?

50% is quite standard for team acquisitions to my knowledge. However, for TechCrunch earn-out sounds quite high. I'm also surprised of the price, it seems low compared to many tech acquisitions. TechCrunch has a lot of eyeballs, even if it doesn't have main stream audience. Midsize Finnish regional newspaper companies have market caps around €180M. TechCrunch, a major international tech publication with millions of r…

It's a lot harder to get ads for an international media. I'd guess most of the ads on www.techcrunch.com are payed by US marketing budgets. The people who manage those only care about US viewers. So question N:1 is how many US viewers, without ad blockers the site has. N:2 - for how long is it gone keep them.

A regional Finnish newspaper is very likely to keep it's audience in one form or another for a long time. That audience has high purchase power and is less likely to go online and research cheaper alternatives to advertised products/services.

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