Posts Tagged ‘Lee Lorenzen’

Which Facebook app would you rather own?

October 15, 2007

For every one of the 5,000+ apps on Facebook, there are probably a dozen people that are thinking about making one. One of the reasons I’m excited about App-Camp is having the opportunity to discuss the future of the application business with the people who know it best. So, I thought I’d take this opportunity to ask some of our discussion leaders a question about owning an app and then have a discussion at App-Camp about why they answered the way they did. It should be noted that all of the following application developers that answered have at least one app in the Facebook top 20*, with the exception of one VC that is an expert in valuating apps.

Question: Which of the following fictional applications would you rather own?

A) Music Focused
* 22 million installs
* 8% daily active users
* Has advertising
* Sells songs through 3rd party technology, keeps 10% of sale

B) Fantasy based game
* 2 million installs
* 29% daily active users
* Has advertising
* Sells virtual game enhancers (spells, safety, weapons, etc.), keeps 70% of sale

C) Communication focused (poke, write, etc.)
* 45 million installs
* 10% daily active users
* No other monetization besides advertising

And the answers from our distinguished panel are……

We will be having what I’m sure will be an interesting discussion at App-Camp as to why these discussion leaders chose the app they did. If you cannot attend, don’t worry, we’ll be posting a recap on this site about the day’s sessions, and this one will be included.

*According to O’Reilly research

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The value of Facebook applications

October 9, 2007

At the Graphing Social Patterns conference in San Jose, I’ve overheard more conversations about the accuracy of application valuations than I’ve been Rick Rolled in the past week. It is safe to say that much of the discussion around the value of apps is because app analytics company, Adonomics, publicly shows what they feel an app is worth on their website. So, of course, we asked Lee Lorenzen, the CEO of Altura Ventures, the Facebook fund that acquired Adonomics in August, to be a discussion leader at App-Camp.

The Adonomics website states the following factors are used to value an application:

  • Facebook-reported numbers
  • Standard web metrics such as pageviews, uniques, visitors, etc.
  • Computed data, such as sudden changes in your growth profile or the age of your application.
  • Estimated growth of your application and Facebook in general
  • Optimal monetization strategies across all possible services, including CPM/CPC/CPI advertising, potential sponsorships, and
    cross-promotion deals.
  • Using that data the following three applications are valued at:

    1) Vampires – $2,678,670
    2) My Aquarium – $2,629,780
    3) (fluff) Friends – $1,629,290

    Are these apps worth that much? Are they worth more? All three of these application developers are leading discussions at App-Camp in addition to Lee Lorenzen, so those attending will have the opportunity to understand application valuations from two unique perspectives.