Re:How Much Revenue Does It Take To Be A $1B Public Company?
by fennecfoxen on Monday April 30, 2012 @01:27AM
(#3908136)
Let's see. Take your 1 billion and look at the opportunity cost, and assume that the market at large can earn you a real return of ~4%, which is ... $40 million profit a year, so divide that by your margins and there you go. If you've got Apple-like margins of 30% you're looking at $130 million in revenue a year (+ revenue growth that matches inflation). A software-only company might do it with less; if you're selling more physical goods you're probably going to need more.
Growth can substitute for that for a while, but in the long run that's about the return you're going to need to have to justify a $1 billion market cap to investors, who also have the opportunity to invest somewhere else.
Growth can substitute for that for a while, but in the long run that's about the return you're going to need to have to justify a $1 billion market cap to investors, who also have the opportunity to invest somewhere else.