Thursday, August 10, 2006

Why the World hates Digg's Kevin Rose?

Why the World hates Digg's Kevin Rose?

Paper Millionaire or Vapor Millionaire.

BusinessWeek's Cover Story How this Kid Made $60 Million in 18 Months is the current online buzz. "People in the know say Digg is easily worth $200 million," says Business Week. And this has sparked fury worldwide and hate stories and comments are flooding websites and blogs. But, why are they angry. Read on to see what they say?

You gotta love it: Kevin Rose says users shouldn't be paid even though 30% of the front page stories come from the top 10 users on DIGG. Congrats on the cover of BusinessWeek Kevin, but be careful counting those chickens before they hatch (from someone who's been there).

DIGG has not been sold yet, from what I understand BusinessWeek is basing the $60M number on someone telling them that DIGG would sell for $200M. DIGG is making $3M a year from what people are saying. That would give them a 65x revenue, and if they have $500k in profit a 400x earnings multiple ($1M in profits would give them a 200x earnings multiple). Wow... makes Google look cheap!

  • Jason
  • one of those who firmly believes that diggers need to be paid

    Forget Paper Millionaire, Digg Founder's A Vapormillionaire
    It also never explains how Kevin Rose made $60 million (probably because he didn't actually make that money), though we're guessing that they calculated his share of that $200 million, based on his stake in the company. At one point it suggests that Digg could become a cash cow like MySpace, a site that's had problems monetizing its enormous base.

  • Joe
  • Techdirt

    Digging up Kevin Rose's net worth

    In other words, Rose has made actually zip, zero, nada. To Techdirt's frustration, BW doesn't offer many more clues in the piece as to how it arrived at the $60 million figure, citing "people in the know." Techdirt guesses that BW must be referring to the notional value of Rose's shares in the business, which BW's sources estimate is valued at $200 million. But of course, those shares aren't worth anything until Rose sells -- and he's said time and again that he doesn't want to sell Digg.

  • Owen Thomas and Oliver Ryan
  • in CNN Money

    That $60 million figure is utter BS. It's tossed out in mid-article with virtually no explanation along with another suspect figure that values Digg at $200 million. Quite a fairy tale, no? Reminds me of the days when a black-and-white sock puppet interviewed fellow canines, the billboard over 101 was still lush and everything was bubblicious.

  • John Paczkowski
  • , (Thomas Hawk is a digital media and technology enthusiast in the San Francisco Bay Area and is an investment advisor in a non technology related field) Good Morning Silicon Valley

    It is riddled with so many inanities, without any sense or logic, or journalistic norms, it sounds like a parody of a parody. Their idea of getting street cred among the tech-savvy/early-adopter/blogger crowd is this, and it sounds like a desperate ploy to stay relevant, even when they don'y. It is about the hype and the treatment that the story is being given. Factual errors, false deductive reasoning, and the general lack of awareness of the dynamics of Internet.


    1 comment:

    1. It was a surprise to see Kevin Rose on the cover of Business Week. However, if was even more of a shock to see him on the cover of People Magazine, just a week after Lance Bass was featured...