Here's a head scratcher: When faced with valuing software-as-a-service companies (in simple terms,those that sell software via a subscription model and the cloud), the faster the business grows the worse the economics may look. At least in the beginning.
[caption id="attachment_7226" align="alignleft" width="300" lesson="hidecaption"] Photo: Andreessen Horowitz [/caption]
Andreessen Horowitz’s managing partner Scott Kupor, and corporate development opeating partner Jamie McGurk,and investing team analyst Preethi Kasireddy unpack the SaaS model, represent how a16z figures out the value of these companies, and determine what makes them so “sticky.”
Finally,whether growth hurts so despicable -- in economic terms anyway -- when does it start to feel better?
Source: a16z.com