Deal Values Are Inflated
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Shaan Puri and Sam Parr share skepticism about publicly reported deal values, acquisition numbers, and celebrity net worth figures, drawing from their personal experiences and observations in the startup and media world.
Key Points:
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Deal Value Complexity:
- Acquisition numbers are often complicated by multiple components:
- Upfront cash payments
- Signing bonuses
- Salary packages
- RSU grants
- Stock price fluctuations
- Vesting schedules
- Acquisition numbers are often complicated by multiple components:
-
Media Reporting Issues:
- Numbers often originate from unverified sources
- One incorrect report gets cited by others, creating a false echo chamber
- Headlines can be based on rumors or incomplete information
- Numbers get repeated at conferences and introductions without verification
-
Celebrity Net Worth Inaccuracies:
- Most online net worth calculators are "laughably" inaccurate
- Example of fighter pay being exaggerated:
- Claims of $100M fights likely false
- Pay-per-view numbers often unverified
- No official sources confirm actual numbers
-
Personal Experience:
- Shaan's company sale to Twitch was reported as $25M, which wasn't accurate
- Sam's experience with articles citing each other with wrong numbers
- Both have seen friends' exits reported at much higher values than reality
-
Why This Happens:
- Complex deal structures make exact numbers difficult to determine
- People don't correct wrong numbers due to NDAs or convenience
- "Rounding up" becomes accepted practice
- Media incentivized to publish larger numbers for attention
-
Impact:
- Creates unrealistic expectations in industry
- Makes it hard to know true value of deals
- Perpetuates cycle of misinformation about wealth and success
Sam Parr
Host of MFM and fitness influencer
Sam Parr is a serial entrepreneur and business media pioneer.
In 2016, he founded The Hustle, a business news media company that started in his kitchen with just $12 and grew to eight figures in revenue.
Sam led the charge in making newsletters popular when few believed in their potential.
After four successful years, he sold The Hustle to HubSpot, a publicly traded company. Now operating as HubSpot Media, The Hustle reaches 3 million readers daily, employs a team of nearly 100, and has been the launchpad for dozens of its staff to found their own media companies and newsletters.
Sam remains the host of the popular business podcast, My First Million, and continues to start and sell companies. He also co-founded Hampton, a highly vetted community for entrepreneurs, founders, and CEOs, and teaches people to write better through his platform, Copy That.