Mediawhiz on sale?

[fanofwicked]

As reported on Techcrunch:

MediaWhiz, a holding company for a number of advertising networks, may be shopping itself to private equity firms. We are hearing that they are looking for $400- $450 million, which is 2.5 - 3 times estimated 2007 revenues. MediaWhiz owns a number of ad networks, including two that are long time sponsors of this site (Text Link Ads and Auction Ads). Both were recently acquired by MediaWhiz. I have an email in to the company for comment. Ad networks are the hot commodity this year, with AOL, Yahoo, Google and Microsoft all making big acquisitions. The size of those deals combined is nearly $10 billion.

http://www.techcrunch.com/2007/08/09/mediawhiz-latest-ad-network-for-sale/

 

[CashLeader]

Are you suprised? Why else would someone want to combine these companies? Their synergy makes them way more valuable. Expect to see alot more of these acquisitions over the next couple years.

 

[Smart_Web]

Just shows you how you can make a lot of money online with a solid website and a good idea.

 

[fanofwicked]

But does it make sense to just aggregate companies to prove a high market valuation. What's the uniqueness: userbase, technology, revenue? Would companies buy Mediawhiz based on these market valuations? What do you think.

 

[CashLeader]

Each company had it's own value. Mediawhiz for Coreg, Monetizeit for Network and products and a good credit card / sub-prime portfolio, GRS for email delivery, etct, etc.

Putting all these companies together makes it stronger than them working independently. It was something I brought up to my partner years ago that if I had enough money I would have done.

Funny thing is that EDebitpay was one of the companies that I mentioned I would have bought due to their large reach in the Sub-prime market. Currently they are having problems with the FTC for "unauthorized" deibts. My cash advance customers make up alot of the EDebitpay customers, so I know most of this is a bunch of crap. Also, I've heard that EDebitpay my be coming back to business soon. That would be a huge victory for them if the rumors are corect. The FTC doesn't shut people down and then let them back in business if any wrong doing was actually found.

Sorry, for getting off topic. Anyway, the synergy from all those companies makes it a potenital power-house to really start squahing competitors. This is what happens in any product cycle. As the products mature companies begin to merge, get aquired, etc until there is only a few companies left and can compete. It is much harder to break in to the market today than it was 2 or 3 years ago.

 

[SeoDave]

But does it make sense to just aggregate companies to prove a high market valuation.

YES.

What's the uniqueness: userbase, technology, revenue?

SEE ALL OF THE ABOVE.

Would companies buy Mediawhiz based on these market valuations? What do you think.

Yes. Most Mergers/Acquisitions these days rely on valuations focusing mostly on revenue, but there are also less traditional valuations that can account for technologies, innovations, uniqueness, userbase, etc. The standard valuations however involve different forms of revenue-based valuations such as LBO (leveraged Buyout) or DCF (Discounted Cash Flow). As far as why MediaWhiz is worth the money and why it was a good idea to aggregate the companies that they did: They created a diversified portfolio of internet businesses with multiple streams of income that span different niches/services in the internet world. They took businesses that individually could be riskier than a portfolio. If you buy one business and competition increases significantly or the market dries up, then you lose a lot of the value of your investment - but if hold a portfolio of business then you have diversified away some of this business risk through your various holdings.