No. I think what we all missed is just how big “tech” got.

60% of Apple’s revenue is from the iPhone. But the iPhone only launched in 2007/2008, and those of using Treos and Blackberries back then could hardly have imagined how huge mobile handsets would get.

Because it turned out they became our mobile computers:

And in general, the web just got huge. So the leaders got huge.

In SaaS, similarly, more and more businesses moved to web processes. So Salesforce crossed $10 billion in revenue and $100 billion in market cap:

Salesforce revenue 2010-2018 | Statistic

Salesforce grew 10x from 2010–2018. That’s basically what happened in SaaS overall, too. SaaS revenues across the board, and across IT departments, CIO budgets, and more recently, SMBs … just exploded in this period.

The web just exploded from ‘11-’18 to an extent few of us really predicted. We knew mobile and more would be accelerants, but boy everything just got so big.

Put differently, yes today Apple crossed $1 trillion in market cap. But it also did $53 billion in Q3 revenue. Let’s call that $200 billion anualized (x 4 quarters). So a $1 trillion valuation is only 5x their annualized revenue run rate. That’s not even that high. And Salesforce, with higher margins that Apple, still only trades at about 8x its revenue run rate. It’s coming up on $12b in ARR.

5x-8x? That’s probably lower than the multiple in your last venture round. And it means if mobile, SaaS, and other trends just continue, these companies are at best, a year overvalued. That’s not that much, really. Certainly, the valuations aren’t nuts.

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