What's a blog worth? Try $100 million. That's the prevailing wisdom regarding The Huffington Post, a political blog-cum-Internet newspaper that has proved popular with liberal voters.
This week, the blogger announced $25 million in new funding that, according to sources quoted by The Wall Street Journal's Kara Swisher, values the firm at a little "south of $100 million." If correct, it's a coup for the site, albeit an unsurprising one.
Consider the timing. Questions linger over the short-term health of online advertising, which could impede Google's (NASDAQ:GOOG) quest to become a new media mogul. Microsoft (NASDAQ:MSFT), meanwhile, denied showing interest in Yahoo!'s search business, and Amazon.com (NASDAQ:AMZN) killed its Alexa search engine. Taken together, these reports suggest there could be fewer opportunities to monetize blogs in the not-too-distant future.
Even so, The Huffington Post's valuation appears reasonable, given what the Web's social superstars -- Facebook and recession-proof Twitter -- fetch today:
|
Company |
Employees |
Valuation* |
Value Per Employee* |
|---|---|---|---|
|
The Huffington Post |
46 |
$100 |
$2.17 |
|
|
30 |
$150 |
$5.00 |
|
|
700 |
$3,750 |
$5.36 |
Sources: Press reports, TMF estimates.
*In millions.
All three are news aggregators in some form but, of them, only the Post specializes in creating content. How does the site stack up against old-media rivals? Pretty well, I'd say:
|
Company |
Employees |
Market Cap* |
Value Per Employee |
|---|---|---|---|
|
Lee Enterprises |
8,100 |
$37.4 |
$4,617 |
|
Journal Communications (NYSE:JRN) |
3,750 |
$120.97 |
$32,258 |
|
McClatchy (NYSE:MNI) |
14,307 |
$161.57 |
$11,293 |
|
New York Times (NYSE:NYT) |
10,231 |
$1,050 |
$102,629 |
|
Gannett (NYSE:GCI) |
46,100 |
$1,950 |
$42,299 |
Sources: Capital IQ, Yahoo! Finance, TMF estimates.
*In millions. Please note that here, value per employee is not in millions.
Color me unsurprised. Old media isn't as crucial as it once was. Twenty years ago, as a young sportswriter, I was stringing together awful clips in exchange for soup money. Now I write for soup and sandwich money for a family of five.
And slow, stodgy, just-the-facts old media is being replaced by real-time, edgy, sometimes erroneous, yet increasingly valuable new media -- including outlets like The Huffington Post and (ahem) The Motley Fool.
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