Internet ‘bubbles’ compared: This time, there’s revenue

Flickr photo via Justin D. Miller

There’s been a lot of chatter in recent months about whether the valuations of Internet companies are out of whack. I tend to agree with those observers who say things are different than the boom times of the late 90s, not only due to the fact that the new-generation of Internet companies have real revenue but also because the vast majority of Americans are not participating in this run-up.

But, what do the numbers say? IPO Dashboards offers a fascinating inside look, comparing Web 1.0 companies like, and InfoSpace to newbies such as Groupon, LinkedIn and Zillow.

“Most companies today have yearly revenues in the hundreds of millions and a couple are actually profitable,” writes Daniel Hom of IPO Dashboards. “They’re also much less expensive given the amount of revenue they produce (Enterprise Value/Revenue) and actually have a positive cash flow from their operating activities.”

But Hom also offers this warning: “Of course, we might just be in a bubble that looks incredibly different from the last one. It’s tough to say whether companies like Groupon, Pandora and Facebook have long-term sustainable business models. We’ll just have to wait-and-see.”

Here’s a look at the chart regarding revenue. (Click on chart for interactive version):


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