Coinbase’s most recent quarter was a complete disaster. The U.S. crypto exchange reported net revenues of $2.49 billion, net income of $840 million, and adjusted EBITDA of $1.21 billion, considerably exceeding market expectations. Coinbase’s Q4 2021 results outperformed its full-year 2020 results by a significant margin.
Despite this, Coinbase shares are up a little more than a point in pre-market trading, and the company is worth roughly $70 per share less than its direct listing reference price; Coinbase is also down around 57 percent from its recent highs.According to current trading, the company’s highly prosperous 2021 — net income of $3.62 billion on total net revenue of $7.35 billion — has resulted in a less valuable Coinbase.
A market cap of $47 billion in 2022 is far from a failure for a firm worth $8 billion in 2018. But it’s still a fraction of what Coinbase was valued at just a few months ago, when it first went public.
According to the former venture capitalist, the fastest-growing cohort has performed “worse than low and medium-growth software” companies this year, according to the formear venture capitalist. In terms of how software businesses are valued, it’s an upside-down season, with growth premiums plummeting. This, I believe, is why we’re hearing that 2021’s late-stage capital cannons are backing away from such agreements. Tiger, D1, and others were betting that by putting money into middle- and later-stage software markets, they would reap the rewards when their portfolios followed an open IPO window into receptive public markets.
Nobody knows how much something is worth.
We’ve discussed this before, but a recent repricing of the whole technology sector highlights the issue once more.
There’s more to the storey than Coinbase, despite the fact that it appears to be priced on a profit multiple rather than a revenue multiple today. The rise in SaaS values has levelled off, according to Altimeter Capital’s Jamin Ball, who stated this week that “high growth software revenue multiples have now reached new lows.”
According to the former venture capitalist, the fastest-growing cohort has performed “worse than low and medium-growth software” companies this year, according to the former venture capitalist. In terms of how software businesses are valued, it’s an upside-down season, with growth premiums plummeting.
This, I believe, is why we’re hearing that 2021’s late-stage capital cannons are backing away from such agreements. Tiger, D1, and others were betting that by putting money into middle- and later-stage software markets, they would reap the rewards when their portfolios follaowed an open IPO window into receptive public markets.
Joseph Gutierrez holds Master’s degree in Business Administration. As an avid day trader, he is a master of technical analysis and writes tirelessly on how stocks are trading. Joseph has extensive knowledge in technical analysis & news writing. He delivers news reports regarding Market category.
