This story was written by Rafat Ali.
So we reported on the return the investors got, but not on Bebo's actual revenue numbers. Kara digs in and reports on some of the real revenue numbers: Bebo's revenues for 2006 were only $7 million with $3 million in EBITDA...In 2007, the results are still small, with $20 million in revenues and $5 million in EBITDA. Based on these numbers, AOL (NYSE: TWX) paid a huge 42.5 times revenues and 160 times EBITDA.
Even looking at projected numbers (which of course may or may not materialize)--$50 million in revenue and $10 million in EBITDA in 2008; $117 million in revenue and $48 million in revenue in 2009 and $193 million in revenue and $92 million in EBITDA in 2010-- it is a very rich deal, for the founders and investors.
Kara says that the high asking price (around $1 billion) and smaller U.S. presence (big in UK and Europe) made others like News Corp (NYSE: NWS). MSFT and others pass on the deal. Allen and Co was hawking the firm.
By Rafat Ali