Valuation model of internet companies

After graduation, Lao A has been working hard in the Internet industry. Whether he starts his own business or works in an enterprise, he is an Internet enterprise. Recently, I talked to some friends about the valuation of Internet companies. After thinking and consulting the information, I summarized the following conclusions:

Look at the following formula first:

V represents the value of Internet enterprises, K is the realization coefficient, P is the premium rate coefficient (depending on the low position of enterprises in the industry), N is the number of network users, and R is the distance between network nodes.

1, k increases, v increases: liquidity increases and enterprise value increases.

2, P increases, V increases: market share increases, enterprise value increases.

3, N increases, V increases: the number of users increases, and the enterprise value accelerates.

4. R decreases and V increases: the distance between network nodes decreases and the enterprise value accelerates.

Therefore, the number of users is the biggest influencing factor. This is why many investors dare to invest in Internet companies with more and more users, such as Amazon, such as JD.COM, before realizing business or profit.

Market share is also a key factor. The so-called winner-takes-all in internet companies is saying this.

And some big V's, celebrities and big ip's on the Internet are all the expressions of R in the formula. These big V's, celebrities, are all highly connected nodes in the network. Their existence shortens the distance between nodes, which also explains why Aauto Quicker's big V live broadcast sold 30 million, and Tik Tok's brother Li Jiaqi's lipstick sold so well.

Users are king: the great Metcalfe's law

Metcalfe's Law was put forward by robert metcalf, the inventor of Ethernet, in 1973. This law is as important as Moore's law in the computer industry. Metcalfe's Law states that the value of a network is directly proportional to the square of the connected devices.

Metcalfe's law holds that the value of the Internet lies in the link nodes. The more nodes, the more potential links and the greater the value. This is also the so-called "* * * the stronger the knowledge" that is often used in the blockchain industry.

The performance of fb and Tencent, the two largest social platforms in the world, proves that Metcalfe's law is indeed effective.