[isp-investor] RE: isp-investor digest: February 20, 2004

It is not a matter of what is the "right" or "wrong" way - it is what is negotiated. As a buyer we will always deduct deferred revenue. As a seller of an ISP in 1999, the deferred revenue liability was subtracted. Regarding Hillary's buyer that doesn't "care" about deferred revenue...who is kidding who? I am certain that it is factored into the negotiation one way or another. Regards, Aaron Larkins Profitability.net . ----- Original Message ----- From: "get in thegame" <pma@...> To: <isp-investor@isp-investor.com> Sent: Tuesday, February 24, 2004 1:51 PM Subject: [isp-investor] RE: isp-investor digest: February 20, 2004 > this is a wrong way to calculate > it assumes that the buyer's cost to provide access is equal to what the > seller has already collected (only subtract the "cost" to provide access > through the prepaid term) > > > ----- Original Message ----- > From: "Hillary Stiff" <hstiff@...> > To: <isp-investor@isp-investor.com> > Sent: Tuesday, February 24, 2004 11:55 AM > Subject: [isp-investor] RE: isp-investor digest: February 20, 2004 > > > > My experience is that most acquirers deduct for prepaids (AKA deferred > > revenue). Generally the deduction is 100%. For example, lets assume a > deal > > is cut at 1x annualized revenue and the deal closes on March 1st and that > > there is a deduction for prepaids/deferred revenue. > > > > Customer A pays $20 monthly. > > Customer B pays $60 quarterly his next renewal date is March 1st. > > Customer C pays $60 quarterly his last renewal date was February 1st. > > Customer D pays $200 annually his last renewal date was January 1st. > > > > Customer A would be worth $240 ($20 monthly rate x 12 months x multiple of > > 1). > > Customer B would be worth $240 ($60 quarterly rate x 4 months x multiple > of > > 1). > > Customer C would be worth $200 ($60 quarterly rate x 4 months x multiple > of > > 1 - $40) The $40 deduction is for the customer's prepaid payment for March > > and April, the seller has collected and the buyer will have to provide the > > service for no compensation. > > Customer D would be worth $33.33 ($200 annual rate x multiple of 1 - > > $166.67) The $166.67 represents the ten months of service that the > customer > > has paid for, the seller has collected, but for which the buyer has to > > provide service for with no payment. > > > > The deduction for deferred revenue/prepaids is not 100% consistent, but it > > is definitely the norm. It is important to understand how a seller will > > treat deferred revenue when you compare offers from one buyer to another. > > For instance we represent a buyer who does not deduct for deferred > > revenue/prepaids. When a buyer does not adjust for deferred > > revenues/prepaids you may end up with an effective multiple which is much > > higher than the stated multiple. For example lets take Customer D again > > (Customers A and B would be treated the same as in the first example.) > > > > Customer D pays $200 annually his last renewal date was January 1st. > > > > Our buyer who does not adjust for deferred revenue/prepaids would pay $200 > > for Customer D ($200 annual rate x multiple of 1). What is interesting > > about this example is that the seller just received $200 from this > customer > > on January 1st and then provided two months of service to the customer, so > > lets assume the seller still has value of $166.67 from this customer(which > > represents the ten months of service that the seller has been paid for but > > doesn't have to provide service for) then the buyer pays $200 at the > close. > > Effectively for this customer you have received $200 from the buyer and > also > > still have $166.67 in the bank account from the customer, a total of > > $366.67, effectively a much higher multiple than 1x. > > > > In summary, if you have a significant number of quarterly or annual > prepays > > how a buyer handles how deferred revenue/prepaids can be a big issue! > > > > This can be a confusing issue to describe, hopefully I haven't confused > the > > issue even more. > > > > Best Regards, > > > > Hillary Stiff > > > > -------------------- > > Cheval Capital, Inc. > > www.chevalcapital.com > > 901 N Pitt Street > > Suite 110 > > Alexandria, Virginia 22314 > > 703-549-8602 > > hstiff@... > > > > > > > > -----Original Message----- > > From: ISP-INVESTOR Discussion List digest > > [mailto:isp-investor@...] > > Sent: Saturday, February 21, 2004 3:00 AM > > To: isp-investor digest recipients > > Subject: isp-investor digest: February 20, 2004 > > > > > > ISP-INVESTOR Digest for Friday, February 20, 2004. > > > > 1. Intellectual Property Web Hosting Company for Sale > > 2. RE: Small hosting for sale > > 3. Terms for the web hosting business > > 4. RE: Small hosting for sale > > 5. RE: Terms for the web hosting business > > > > ---------------------------------------------------------------------- > > > > Subject: Intellectual Property Web Hosting Company for Sale > > From: "Joseph P Marino" <ceo@...> > > Date: Fri, 20 Feb 2004 08:52:27 -0500 > > X-Message-Number: 1 > > > > Hello, > > > > I am currently selling a start-up web hosting company that specializes > > in secure business-class hosting solutions, no subscribers are included > this > > is a pure technology\Intellectual Property deal, company will come with > > business plan that was written in order to successfully launch and operate > > the business for 3 years. The company can be broken down into about 4 > > companies with it's technology, company comes with full front-end web site > > professionally developed by a marketing firm from nyc, all interfaces can > > easily be co-branded and re-sold. Web site is very advanced it has > > everything, sets up new accounts, live chat, excepts cc's , checks in > > real-time etc everything, also includes back-end functions to work with > your > > internal sales and support operations. > > > > Technology includes: > > - proprietary full fledged control panel for virtual hosting clients > > - proprietary web-based e-mail client, with a wide array of advanced > > security features including spam filtering > > - proprietary web hosting module that integrates with apache that improves > > the performance and security of your web server, the module blows > Interland > > blueHalo's technology away performance and security wise > > > > This deal is perfect for any company looking to expand or re-brand itself > or > > you can do a secure business-class hosting spin-off > > > > Above is just some of the technology included in the deal I could go on > for > > about 20 minutes explaining all features and benefits, if you are curious > as > > to why I am selling this company it is because I've been occupied recently > > with another project as I do not have any free time for this project > > anymore. > > > > Please contact me off-list if you are interested, I will follow up with a > > phone call and my lawyer\partner will follow up with an NDA > > > > > > > > ---------------------------------------------------------------------- > > > > Subject: RE: Small hosting for sale > > From: "Gary Carr" <gc_list@...> > > Date: Fri, 20 Feb 2004 11:39:06 -0500 > > X-Message-Number: 2 > > > > My understanding from past deals was that yearly prepays usually get > > deducted from the payout of the accounts as they are a liability until > they > > renew. > > > > > > > > Gary > > > > > > > > > > > > > > Gary, > > > > > > > > > > > > I don't know it's question more than a statement? What do you think? > > > > > > > > > > > > ted gibson > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > > --- On Thu 02/19, Gary Carr < gc_list@... > wrote: > > > > > > From: Gary Carr [mailto: gc_list@...] > > > > > > To: isp-investor@isp-investor.com > > > > > > Date: Thu, 19 Feb 2004 15:23:53 -0500 > > > > > > Subject: [isp-investor] RE: Small hosting for sale > > > > > > > > > > > > > Cash is good, but terms are OK, the price just as much I can get, what > > is a small prepaid hosting going for 1.0 maybe 1.5, I don't know, >it's > > not that much money. >? What area(s) are Hmm, are yearly > > prepaid accounts going for 1.0 and up? Gary > Carr 705A > > Wesley Pines Rd. COL Networks, Inc. Lumberton, NC 28358 Phone: > > 910-618-9790 x 13 Fax: 910-618-9027 Check us out at: > > www.carolina.net ___________ The ISP-INVESTOR > > Discussion List ___________ To Join: > > mailto:join-isp-investor@isp-investor.com To Remove: > > mailto:remove-isp-investor@isp-investor.com Archives: > > http://isp-lists.isp-planet.com/isp-investor/archives/ To unsubscribe > via > > postal mail, please contact us at: Jupitermedia Corp. Attn: > Discussion > > List Management 475 Park Avenue South New York, NY > 10016 Please > > include the email address which you have been contacted > > with. ------------------------ANNOUNCEME! > > > > > > NT--------------------------------- ------------------------------------- > > -------------------------------- ** ISPCON Spring 2004 ** > > Washington DC Hilton & Towers ** ** The industry's ISP and WISP > > event ** www.ispcon.com ** ** 10 years experience illuminating > the > > market's future > > > ** ---------------------------------------------------------------------- > > > ---------------------------------------------------------------------- > r> > > > > > > _______________________________________________ > > > > > > > > > > > > To unsubscribe via postal mail, please contact us at: > > > Jupitermedia Corp. > > > Attn: Discussion List Management > > > 475 Park Avenue South > > > New York, NY 10016 > > > > > > Please include the email address which you have been contacted with. > > > > > > ------------------------ANNOUNCEMENT--------------------------------- > > > --------------------------------------------------------------------- > > > ** ISPCON Spring 2004 ** Washington DC Hilton & Towers ** > > > ** The industry's ISP and WISP event ** www.ispcon.com ** > > > ** 10 years experience illuminating the market's future ** > > > ---------------------------------------------------------------------- > > > ---------------------------------------------------------------------- > > > > > > > > > > > ---------------------------------------------------------------------- > > > > Subject: Terms for the web hosting business > > From: "Ted Gibson" <ted.gibson@...> > > Date: Fri, 20 Feb 2004 14:43:08 -0500 (EST) > > X-Message-Number: 3 > > > > > > > > > > > > > > All, > > > > > > > > Several people have been asking me about terms for the web hosting. > > > > > > > > See if this makes since. > > > > > > > > The business did $26, 875 in 2003. > > > > > > > > I was thinking a sealing price of .75 of yearly revenue $21,150 with 40% > > $8,400 with 12 payments of $1,050 > > > > > > > > or maybe .85, $22,800 with 25% $6,840 with 18 payments of $890. > > > > > > > > I don't know whatever works for you? > > > > > > > > Ted > > > > > > > > _______________________________________________ > > > > > > ---------------------------------------------------------------------- > > > > Subject: RE: Small hosting for sale > > From: "Ted Gibson" <ted.gibson@...> > > Date: Fri, 20 Feb 2004 14:44:49 -0500 (EST) > > X-Message-Number: 4 > > > > > > > > > > Me too, you come with a price and then reduce by the months left, I think > > that's how it works, right? > > > > > > > > ted > > > > > > > > > > > > > > > > --- On Fri 02/20, Gary Carr < gc_list@... > wrote: > > > > From: Gary Carr [mailto: gc_list@...] > > > > To: isp-investor@isp-investor.com > > > > Date: Fri, 20 Feb 2004 11:39:06 -0500 > > > > Subject: [isp-investor] RE: Small hosting for sale > > > > > > > > My understanding from past deals was that yearly prepays usually > > get deducted from the payout of the accounts as they are a liability > > until they renew. Gary > > > > Gary, > > > > I don't know it's question more than a > statement? > > What do you think? > > > > ted > > > gibson > > > > > > > > > > > > > > > > --- On Thu 02/19, Gary Carr < gc_list@... > wrote: > > > > From: Gary Carr [mailto: gc_list@...] > > To: > > isp-investor@isp-investor.com > > Date: Thu, 19 Feb 2004 > > 15:23:53 -0500 > > Subject: [isp-investor] RE: Small hosting for > > sale > > > > > Cash is good, but terms are OK, the price just > as > > much I can get, what is a small prepaid hosting going for 1.0 maybe > > 1.5, I don't know, >it's not that much money. >? What area(s) > > are Hmm, are yearly prepaid accounts going for 1.0 and > > up? Gary Car! > > r 705A Wesley Pines Rd. COL Networks, Inc. Lumberton, NC > > 28358 Phone: 910-618-9790 x 13 Fax: 910-618-9027 Check us out > > at: www.carolina.net ___________ The > > ISP-INVESTOR Discussion List ___________ To > > Join: mailto:join-isp-investor@isp-investor.com To > > > Remove: mailto:remove-isp-investor@isp-investor.com Archives: http: > > //isp-lists.isp-planet.com/isp-investor/archives/ To unsubscribe > > via postal mail, please contact us at: Jupitermedia Corp. Attn: > > Discussion List Management 475 Park Avenue South New York, NY > > 10016 Please include the email address which you have been > > > contacted with. ------------------------ANNOUNCEME! > NT---- > > ----------------------------- ------------------------------------- > -- > > ------------------------------ ** ISPCON Spring 2004 > > ** Washington DC Hilton & Towers ** ** The industry's ISP and > > WISP event ** www.ispcon! > > .com ** ** 10 years experience illuminating the market's > > > future ** ------------------------------------------------------------ > > ---------- -------------------------------------------------------- > -- > > ------------<b r> > > > > _______________________________________________ > > > > Join: > > mailto:join-isp-investor@isp-investor.com > To Remove: > > mailto:remove-isp-investor@isp-investor.com > Archives: > > http://isp-lists.isp-planet.com/isp-investor/archives/ > To unsubscribe > > via postal mail, please contact us at: > Jupitermedia Corp. > Attn: > > Discussion List Management > 475 Park Avenue South > New York, NY > > 10016 > > Please include the email address which you have been > > contacted > > > with. > > ------------------------ANNOUNCEMENT------------------------ > > --------- > ----------------------------------------------------------- > -- > > -------- > ** IS! > > PCON Spring 2004 ** Washington DC Hilton & Towers ** > ** The > > industry's ISP and WISP event ** www.ispcon.com ** > ** 10 years > > experience illuminating the market's future > > > ** > -------------------------------------------------------------------- > > -- > ------------------------------------------------------------------ > -- > > -- > ___________ The ISP-INVESTOR Discussion List > > > Remove: mailto:remove-isp-investor@isp-investor.com Archives: > > http://isp-lists.isp-planet.com/isp-investor/archives/ To unsubscribe > via > > postal mail, please contact us at: Jupitermedia Corp. Attn: > Discussion > > List Management 475 Park Avenue South New York, NY > 10016 Please > > include the email address which you have been contacted > > > with. ------------------------ANNOUNCEMENT--------------------------- > > ------ --------------------------------------------------------------! > > ------- ** ISPCON Spring 2004 ** Washington DC Hilton & Towers > > ** ** The industry's ISP and WISP event ** www.ispcon.com ** > > ** 10 years experience illuminating the market's future > > > ** ---------------------------------------------------------------------- > > > ---------------------------------------------------------------------- > r> > > > > _______________________________________________ > > > > > > ---------------------------------------------------------------------- > > > > Subject: RE: Terms for the web hosting business > > From: "Ted Gibson" <ted.gibson@...> > > Date: Fri, 20 Feb 2004 14:59:41 -0500 (EST) > > X-Message-Number: 5 > > > > > > I did some work for a company that is in the business of move skinny > > minutes, by that I mean calling card company has a customer and they call > a > > toll-free that is routed to a call number in every lata in the US and then > > this company changes the voice to VOIP so they don't have to pay the > tariff > > costs, moved to the lata where the customer is calling and then gives it > > back to the local ILEC for a free local call. > > > > > > > > The calling card or ATT wireless just about anyone that sells long > distance > > uses them pays $.007 a minute to this company and then the calling card > > charges their customers 3 to 10 cents a minute. > > > > > > > > This company started in business as ISP and hosting company, but wants to > > get out of the retail. They already sold the 6,000 customer $29.95 a month > > for unlimited long distance. > > > > > > > > I just purchased the 275 to 300 customer web hosting piece of the business > > (small $26,875 in 2003). All of which is billed monthly or yearly to the > > customers credit cards. > > > > > > > > The web hosting and web email comes with 3 front end web servers (sun) and > a > > back end SQL. The system also has a control panel so customers can make > > their own changes. > > > > > > > > I don't want to get tried down to something for $2K a month, so I'm > flipping > > it. > > > > > > > > Thats about all there is. > > > > > > > > ted > > > > > > > > > > > > > > > > > > > > > > > > > > > > --- On Fri 02/20, Kristopher Pilles kpilles@... wrote: > > > > From: Kristopher Pilles [mailto: kpilles@...] > > > > To: ted.gibson@... > > > > Date: Fri, 20 Feb 2004 14:45:10 -0500 > > > > Subject: RE: [isp-investor] Terms for the web hosting business > > > > > > > > Hi Ted. Can you send me more information on what you are selling, I > > caught the tail end of this thread but we are > > interested -----Original Message----- From: Ted Gibson > > [mailto:ted.gibson@...] Sent: Friday, February 20, 2004 2:43 > > PM To: isp-investor@isp-investor.com Subject: [isp-investor] Terms > for > > the web hosting > > business All, Several people > > have been asking me about terms for the web hosting. See if > > this makes since. The business did $26, 875 in > > 2003. I was thinking a sealing price of .75 of yearly > revenue > > $21,150 with 40% $8,400 with 12 payments of $1,050 or > > maybe .85, $22,800 with 25% $6,840 with 18 payments of > > $890. I don't know whatever works for > > > you? Ted _____________________________________ > > ___________ To! > > Join: mailto:join-isp-investor@isp-investor.com To Remove: > > mailto:remove-isp-investor@isp-investor.com Archives: > > http://isp-lists.isp-planet.com/isp-investor/archives/ To unsubscribe > via > > postal mail, please contact us at: Jupitermedia Corp. Attn: Discussion > > List Management 475 Park Avenue South New York, NY > 10016 Please > > include the email address which you have been contacted with. > > > > _______________________________________________ > > > > > > > > > > --- > > > > END OF DIGEST > > > > > > --- > > You are currently subscribed to isp-investor as: hstiff@... > > To unsubscribe send a blank email to > > %%email.unsub%% > > To unsubscribe via postal mail, please contact us at: > > Jupitermedia Corp. > > Attn: Discussion List Management > > 475 Park Avenue South > > New York, NY 10016 > > > > Please include the email address which you have been contacted with. > > > > > > > > > > > > To unsubscribe via postal mail, please contact us at: > > Jupitermedia Corp. > > Attn: Discussion List Management > > 475 Park Avenue South > > New York, NY 10016 > > > > Please include the email address which you have been contacted with. > > > > > > To unsubscribe via postal mail, please contact us at: > Jupitermedia Corp. > Attn: Discussion List Management > 475 Park Avenue South > New York, NY 10016 > > Please include the email address which you have been contacted with. > > To unsubscribe via postal mail, please contact us at: Jupitermedia Corp. Attn: Discussion List Management 475 Park Avenue South New York, NY 10016 Please include the email address which you have been contacted with.

Whitepapers and eBooks

Intel Whitepaper: 2010 Intel Core vPro Processors Overview
Article: Adobe Helps PHP Developers Create Rich Internet Applications
Article: Reduce Your Infrastructure Costs with Microsoft System Center
Intel Brief: Five-Star IT Support--Intel Core 2 processor with vPro Delivers ROI of 524 Percent
Article: Security Enhancements Abound in Windows Server 2008
Intel Whitepaper: Implementing Intel vPro Technology to Drive Down Client Management Costs
Microsoft Whitepaper: Improve Communications and Collaboration

Intel Article: Intel Core i5 vPro Brings Intelligence to the Processor
Microsoft Personalized Whitepapers and Resources for You
Microsoft Articles: Visual Studio 2010
Adobe Article: Java Developers Finding a Home at Adobe Flex
Microsoft Whitepaper: Make Better Decisions - SQL Server 2008 Business Intelligence.
MORE WHITEPAPERS, EBOOKS, AND ARTICLES

Webcasts

Downloads and eKits

Tutorials and Demos