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March 18, 2008

Is Meebo Worth Half a Slide?

Michael Arrington

38 comments »

Investment banker Michael Montgomery has his chance to prove he’s still relevant in the tech banking world if this VentureBeat story is true. The rumor is that Meebo has hired Montgomery & Co. to represent them in a new fundraising round that may value the company at a cool $250 million.

If they pull it off, they’ll set Meebo’s value at half of the $500 million Slide was recently able to talk the markets into. That Slide deal had Montgomery & Co. competitor Allen & Co. behind the deal.

In fact, Allen & Co. seems to be representing all the hot startups these days. In addition to representing Slide in that massive valuation, they’ve worked with Bebo in their recent sale to AOL and Digg in their ongoing acquisition talks, etc. Montgomery, meanwhile, has been taking on lower profile deals like Technorati’s recent fundraising/sale effort. If Montgomery pulls of this deal, perhaps Silicon Valley startups will stop looking exclusively to Allen & Co. for the big stuff.

Is Meebo worth half a Slide? Well, I’m not sure Slide is worth half a Slide, to be honest. If anything, though, Meebo is a potentially more interesting platform. They have created a syncronous world of chat that works perfectly along side a number of applications. Gaming, for example, is a natural fit with Meebo.

Still, Comscore says Meebo has only 4.6 million unique monthly visitors. That’s valuing each of them at $54. That’s significantly more than AOL paid for each of Bebo’s 22 million Comscore visitors ($39). My guess is the valuation may get taken down a notch or two before the deal’s done. Or perhaps not, if Montgomery does his job and gets a few bidders going after the deal.

CrunchBase Information
Meebo
Montgomery & Co
Information provided by CrunchBase
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This entry was posted on Tuesday, March 18th, 2008 at 12:05 am and is filed under Company & Product Profiles. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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Comments

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  1. Alex

    March 18th, 2008 at 12:10 am

    Depends. What’s the rumored revenue number?

  2. Michael Arrington

    March 18th, 2008 at 12:13 am

    Alex - let’s call it near zero.

  3. banglo

    March 18th, 2008 at 12:13 am

    I’d like to mirror the post’s sentiment. Meebo has created a unique community and could potentially be worth at least $125 mil.

  4. Yakov

    March 18th, 2008 at 12:18 am

    It would be even more interesting to see a value at which they may be acquired after that fundraising’s valuation

  5. AD

    March 18th, 2008 at 12:19 am

    Maybe we should also take into account the average time a user spends on meebo in a day

  6. Brian

    March 18th, 2008 at 12:22 am

    Meebo has a spam problem. Every time I sign in there, I get 10-15 spam windows popping up. I will stop using them if the problem gets worse, and I suspect many, many other users will as well. Probably just a glitch that will get solved. Love it otherwise.

  7. Alex

    March 18th, 2008 at 12:27 am

    Is Meebo worth more than Bear Stearns? Probably not. But, they do have a unique value proposition.

    ***Readers if you get a chance to see the Charlie Rose show from this evening its a MUST***

  8. jjjj

    March 18th, 2008 at 12:28 am

    Haha, people will pay for anything. Meebo is nothing new , You can put together a couple of opensource components and have a working alternative within a few hours.

    Why would somebody buy meebo for 500 mil ? , oh yeh the brand name ( sorry but its not that precious a brand name ) , oh the technology ( sorry the tech is nothing mind blowing , a competent programmer could knock it up in no time ).

    its untrue how Hype works when it comes to the internet business model.

  9. Adam Lindemann

    March 18th, 2008 at 12:42 am

    Michael, could you please contact me via my email? I would like to arrange a time when I could walk you through a venture that we have been incubating here at Mind Fund for two years. Sorry to clutter up the comments and feel free to delete this intrusion on the conversation.

  10. webrexia

    March 18th, 2008 at 1:10 am

    Meebo is another startup success story.with $500million valuation, its going great.

    regards
    http://www.webrexia.com

  11. Rob

    March 18th, 2008 at 1:12 am

    Is Slide worth half a slide? Worth is a relative term and to me, it’s not. If your book value is under 1 million and you think you’re worth 500 I think something is off. So do I need to hire Allen & Co to put a ridiculous projection next to my startup name? I think I have better things to spend my money on.

  12. John Smith

    March 18th, 2008 at 1:14 am

    Great post.

  13. veliancho

    March 18th, 2008 at 1:32 am

    seems like there are bubbles in recession times as well. I would short the stock that buys them $500 mil for them.
    It is a okay tool , does not mean wow.

  14. kayoone

    March 18th, 2008 at 1:33 am

    @jjjj
    like always its about the users. Of course someone could make a meebo clone in a short time, but if nobody uses it, nobody cares and the valuation is zero.

  15. AD

    March 18th, 2008 at 1:38 am

    @jjj And no doubt its quite easy to clone meebo or as a matter of fact most of the successful web 2.0 ventures but building a user base and making your service scalable is a different ball game altogether

  16. ze Mobile Phone

    March 18th, 2008 at 1:57 am

    As suggested on Venturebeat.

    No defensible IP. Reluctance to provide clear business model strategy. “Free” is not always the best way to go. Facebook could spend $5 million - get team of 10 developers in a room for 3 months and build the platform themselves - including the integration of Skype and QQ. I’m just not sure who would buy this company for such a high value even with 29 million uniques.

    While I wish them all the best, I’m just not sure its feasible. But hey, if they can do it - awesome!

    Ze

  17. Jens Schwoon

    March 18th, 2008 at 3:48 am

    Hi everybody

    Concerning the fact that a 23 year old guy made an opensource-version of a meebo clone while being a student…

    I don’t get it why there has to be so much money involved in the “game”

    Here is a link to the opensource - meebo blog from Harlan Iverson:
    http://blog.devspan.com/

  18. YDrive

    March 18th, 2008 at 4:11 am

    Technically speaking (or more precisely, technologically speaking), worth more than Slide.

  19. al

    March 18th, 2008 at 7:22 am

    Wow have things gotten distorted. Did people not learn that paying for eyeballs with no sustainable loyalty is not a good idea.

  20. Joshua Beil

    March 18th, 2008 at 7:55 am

    Meebo’s per user valuation changes quite substantially if you take into account their unique visitors of the MeeboMe rooms widget. I’ve seen numbers in the 10-14M range and counting for just this application. Factor this in to the 4.6M uniques to Meebo.com and it’s at a discount to Bebo.
    ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
    Joshua Beil
    Director, Social Media & Technology Segment
    Level 3 Communications

  21. Everett

    March 18th, 2008 at 8:04 am

    Here’s an interesting thought… As Michael pointed out, Montgomery & Co. seem to be representing all the hot new startups. You think it’s too much on their plate? How many of these deals have seen fruition through them?

  22. Marzipan from Toledo

    March 18th, 2008 at 8:19 am

    some of you seem to have some sort of blog dyslexia and need to read through things thoroughly, and perhaps even take notes before commenting.

  23. Jason

    March 18th, 2008 at 8:36 am

    $0 revenue / $500 million valuation

    I feel like I am setting in on a Broadcast.com sales pitch

  24. micfo.com

    March 18th, 2008 at 9:25 am

    The meebo rooms feature is pretty nice and also now it’s available with Facebook Apps, I hope meebo will continue growing with new features.

  25. jjjj

    March 18th, 2008 at 9:46 am

    Right from the beginning I always thought meebo was abit of a con ( how else could such readily made code get funding ) , but good on the founders for selling Meebo to the venture capitals.

    Perhaps they can give me insight into how I can sell my new startup to VC’s.

  26. Hey Jude

    March 18th, 2008 at 10:14 am

    I love Meebo…..and I won’t be surprised if they get that valuation…..its a hell of a lot more useful than slide……and they are using some cool monetization tricks too….

    these valuations are pretty scary though….on one hand we have a recession brewing and on the other there are some dumb corp dev guys paying $500 MM for Slide…..no disrespect to Max Levchin…..but seriously this whole valuation relative to youtube could possibly kill the web 2.0 phenomenon which has created so many cool services

  27. whoopie

    March 18th, 2008 at 10:31 am

    the major IM companies will never let their revenue be hijacked long term, if meebo actually grows a pair and generates revenues in exclusion of those that would be generated through a native IM client, then they will simply be blocked. meebo is small enough and insignificant enough that the major hosters can close them off without any real ramifications.

    so what you are left with is the value of their own native meebo network…i’m sure that has about a thousand or so diehard users.

    once again, the real issue here is the sustainability of a business model predicated on stealing revenue from IM hosters.

  28. Hey Jude

    March 18th, 2008 at 10:36 am

    whoopie you are still bringing up a 2 year old issue…..and no one has blocked them yet…..instead if they do the deals right, I think this could actually mean some money for Yahoo, MSN and others for their IM divisions……I don’t think Meebo could ever be big enough to be a threat to Yahoo, MSN etc….and they have a zero risk of getting banned…..and in case you didn’t know they are backed by Sequoia…..so that kind of shit doesn’t happen to their companies…..

  29. Lame

    March 18th, 2008 at 10:54 am

    its not wow, its not even practical. I keep closing the damn browser!

  30. Technicle

    March 18th, 2008 at 7:59 pm

    What about Soashable, the Meebo clone?

  31. Pranesh

    March 19th, 2008 at 11:11 am

    I introduced many of my friends to Meebo. We were very happy to see an application that got us rid of downloading messenger. But very soon, I found that I was receiving more than usual spams. The number of spams kept increasing. Now I get around 10 spams everyday in IM and 10 spams on mail. All my friends who started using meebo have the same problem. Several of them have stopped using meebo, and many more are quitting meebo now. Sad to see the lads getting disenchanted. Then I also read the privacy policy of meebo. it is very shady.

    Many of us now believe that meebo is trading our IP addresses and oher information (if not the email addresses) for these spams. If it continues, meebo will lose a very big chunk of costumers.

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