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Micro companies worth a billion are here
Thank you internet
Billion dollar companies with few employees are finally with us according to analysts Magister Advisors, M&A advisors to the technology industry.
In a report the company claimed that there were a new breed of super-efficient technology companies emerging which took advantage of near-free distribution channels. The report points to the recent acquisitions and IPO valuations to prove it.
Facebook’s acquisition of Instagram was a case study. The company had 13 staff and was worth a billion dollars. Facebook’s value implies that each employee for its own business of $33 million. Microsoft, by contrast, has a value per employee of $3 million.
Victor Basta, managing director of Magister Advisors, said: “The potential for this new breed of super-efficient companies to accelerate revenue generation is unprecedented. Microsoft went from zero to $1 million revenues in 3 years. Facebook, by comparison, went from zero to $150 million revenues in 3 years, representing a 40-fold acceleration in real terms. This will only get easier and faster for the right idea.”