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Message
re: "Twitter-X has been a colossal failure since Elon purchased the platform"
Posted on 11/25/23 at 11:10 am to SlimTigerSlap
Posted on 11/25/23 at 11:10 am to SlimTigerSlap
quote:
Where'd you get this information?
Common knowledge, even Elon admitted it was only worth half what he paid for it at one point
quote:
Everyone knew that Twitter wasn’t worth $44 billion when Elon Musk bought it a year ago. Now, we know what Musk himself thinks it’s worth today: $19 billion.
On Monday, employees at X were awarded equity in the company at a valuation of $19 billion, or $45 per share, according to internal documents seen by The Verge. That price is a 55 percent discount to Musk’s original purchase price, per the documents, which note that “the fair market value per share is determined by the Board of Directors based on a number of factors in a manner that complies with applicable tax rules.” (Musk is X’s chair and has yet to create a formal board.)
This post was edited on 11/25/23 at 11:12 am
3
Posted on 11/25/23 at 11:12 am to Corinthians420
quote:
Common knowledge
Link?
Posted on 11/25/23 at 11:12 am to Corinthians420
I know that part. I'm talking about this information:
quote:
but under Elon's guidance it is making its way back to being worth what he paid for it and will pass it.
Posted on 11/25/23 at 3:45 pm to Corinthians420
Couple of things to unpack
These valuations are not necessarily accurate representations of the true valuation of the company. It’s actually beneficial to the employees to have a lower valuation, as they’ll make more in the event of an IPO (the larger the spread, the more in an employee’s pocket). We’ve actually had to explain this to board members as they sometimes don’t understand how this works for private companies. BTW, it’s not an inaccurate valuation, it’s just one that will be at the lower end of the valuation range that can still be justified to the auditors(valuation is an art, not a science).
Regarding market cap, Twitter/X does not have a market cap, as it is not listed on a market that provides an arms length share value. It has a valuation, and valuations can vary based on the set of assumptions used. In practice, you’d like to value using three different approaches and see where the ranges overlap.
quote:
On Monday, employees at X were awarded equity in the company at a valuation of $19 billion
These valuations are not necessarily accurate representations of the true valuation of the company. It’s actually beneficial to the employees to have a lower valuation, as they’ll make more in the event of an IPO (the larger the spread, the more in an employee’s pocket). We’ve actually had to explain this to board members as they sometimes don’t understand how this works for private companies. BTW, it’s not an inaccurate valuation, it’s just one that will be at the lower end of the valuation range that can still be justified to the auditors(valuation is an art, not a science).
Regarding market cap, Twitter/X does not have a market cap, as it is not listed on a market that provides an arms length share value. It has a valuation, and valuations can vary based on the set of assumptions used. In practice, you’d like to value using three different approaches and see where the ranges overlap.
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