Disclaimer: This is a crazy Hooman idea/theory. Like most things, I am trying to think this through. Bashing is OK (this is probably a controversial topic), but friendly ideas appreciated as well.
Let’s start out with the obvious – we’re not exactly in a boom economy. That being said, there are some interesting dynamics in the online media space that might lead to something interesting in the next 1-2 years. There might be a period of real liquidity in the online space coming soon. Here’s a potential scenario:
1. US Economy ‘turns up’ starting in 2010
2. Venture investors crowd in a couple deals in Q1/Q2 ’10
3. Wave 1 of M&A: Superpowers ‘pick-up’ companies between Q309-Q310
4. AOL spins out in 12-16 months
5. Facebook files S1 for public offering in 16-18 months
6. Leaders in online space ‘fast follow’ Facebook and file to go public (see list below)
7. Wave 2 of M&A: Trying to get ready for the coming war, the next big round of pick-ups
Now, before the pundits come to scream about how social media/web 2.0 companies don’t make money, let me say something. Some of them do. Yes, there are companies that are still working it out. But welcome to the world, it’s hard.
Facebook is estimated to do $300MM this year. LinkedIn is estimated to be doing over $100MM in revenue. Zynga and Offerpal are estimated to have revenues around $60-70MM this year. And let’s not forget the media darling Hulu. They are crushing it on growth and content acquisition, putting them in a solid position to disrupt the traditional television market. Project this scenario out over 2 years and things could get fun.
Here is a list of folks that I am watching. Would love to know yours. Also, if anyone has any revenue guess-timates (hate that word), that would be interesting to know. And yes, I threw Twitter on there. I have no clue what to do with them, but they are getting too big to not think about.