Billion-Dollar/Employee Company Almost Here Says Analyst

An report published by mergers and acquisitions specialist Magister Advisors, highlights the fact that current market conditions will make it possible in a near future for a company to be worth $1 billion per employee (or as the authors of the report put it, near-zero, billion dollar company).

Magister Advisors cites the recent acquisition of Instagram by Facebook where a 13-staff company was valued at $1 billion or around $77 million per employee. Facebook itself, according to its IPO filing, has an employee valuation of $33 million while Microsoft is less than a tenth of that.

Four factors can explain why within a generation, a new breed of super-efficient companies have managed to increase the approximate value of companies to new heights.

These are established distribution channels, zero-cost download business models, near free + stable software stacks and reusable components as well as user connection marketing.

All four managed to get Instagram into a success in only 551 days while multi-billion dollar Twitter was developed over a weekend and was coded and launched within 120 days.

ABOUT THE AUTHOR

Desire worked at ITProPortal right at the beginning and was instrumental in turning it into the leading publication we all know and love today. He then moved on to be the Editor of TechRadarPro - a position he still holds - and has recently been reunited with ITProPortal since Future Publishing's acquisition of Net Communities.