Wednesday 29 September 2010

AOL acquisition values TechCrunch readers at $5

TechCrunch founder Michael ArringtonImage via WikipediaTwo days ago Om Malik reported that AOL was close to acquiring TechCrunch and, sure enough, the deal was sealed live on stage - if you believe the theatrics - at TechCrunch Disrupt yesterday. According to several reports the acquisition is for $25 million, although CNBC has claimed $40 million.

If the lower figure is correct, Business Insider says the deal values the company at 2.5X revenue, since Mike Arrington claimed revenue was nearly $10m. But what value does that put on TechCrunch readers?

Taking a look at DoubleClick Ad Planner, a Google product, TechCrunch has 4.7 million readers worldwide. The figures, which are estimates, value each reader at just over $5 each. So has AOL got a great deal or - as it did with Bebo - grossly overpaid for a product whose value depends on its founder?