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Democorruptcy

Zoopla shares soar as US firm makes £2.2bn takeover bid

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Shares in Zoopla Group (ZPG) shot up 30 per cent at the open on Friday after reports that US venture capital firm Silver Lake has offered to buy the firm for £2.2bn

Zoopla, which owns the eponymous online estate agent as well as price comparison service uSwitch, is currently part owned by the Daily Mail and General Trust, which merged its online property business with Zoopla in 2012. DMGT remains Zoopla’s largest shareholder, having backed it through its IPO in 2014. Shares in the group jumped as much as 9 per cent in early trading on Friday.

Paul Zwillenberg, chief executive of DMGT, said the offer “promises to deliver a very significant return for DMGT”: the company stands to make around £640m from the sale of its holding in Zoopla.

“The sale of our stake, pending shareholder approval at ZPG, fits with our long track record of successfully identifying new opportunities, incubating young businesses and supporting their growth to create value for shareholders,” Mr Zwillenberg said.

https://uk.finance.yahoo.com/news/zoopla-shares-soar-us-firm-071800890.html

 

Daily Mail property ramping paid off?

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I never get why zoopla or right move are worth much at all. I could build the same size in a month with a team of 30.

 

I guess it's the well known name, but still.

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2 minutes ago, Bsmf said:

I never get why zoopla or right move are worth much at all. I could build the same size in a month with a team of 30.

 

I guess it's the well known name, but still.

No you couldnt.

Cant speak fir zoopla but rightmoves to some imoressive software.

Its really not a matter of php and sone piccies.

Youve got 100k of property stored. Youve got 1000s of EAs uploading and changing stuff.

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Rarely look at Zoopla these days just seemed like a poor mans RM in that RM has everything they have and much more.

Still £2.1 Bln how the hell can advertising property be worth so much.

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15 minutes ago, TJHooker said:

Rarely look at Zoopla these days just seemed like a poor mans RM in that RM has everything they have and much more.

Still £2.1 Bln how the hell can advertising property be worth so much.

It’s the Canary in the Coal Mine Moment I have been waiting for- it didn’t sink in this morning or all day when I read this news.

TJ Hooker thank you because now you’ve asked the main question- how can it be worth it- you’ve reminded me where this came up before.

Ireland, just before the GFC.

...the Irish Times newspaper group bought the Irish version of Zoopla of the time for €40 million euro. Bloody mad money. MyHome.ie it was called IIRC.

Dead Canary.

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It does say the £2.2bn is for Zoopla and USwitch but I have no idea why the valuation is so high.

It will interesting to see if once the Daily Mail sells, whether they continue to detail the house price of everybody mentioned in a news article.

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7 minutes ago, Thorn said:

It’s the Canary in the Coal Mine Moment I have been waiting for- it didn’t sink in this morning or all day when I read this news.

TJ Hooker thank you because now you’ve asked the main question- how can it be worth it- you’ve reminded me where this came up before.

Ireland, just before the GFC.

...the Irish Times newspaper group bought the Irish version of Zoopla of the time for €40 million euro. Bloody mad money. MyHome.ie it was called IIRC.

Dead Canary.

ZPG  made £48.1mln profit in 2017 
https://www.ft.com/content/240249b0-d503-11e7-8c9a-d9c0a5c8d5c9

Only 50 years or so to get their money back.

 

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1 hour ago, Democorruptcy said:

It does say the £2.2bn is for Zoopla and USwitch but I have no idea why the valuation is so high.

It will interesting to see if once the Daily Mail sells, whether they continue to detail the house price of everybody mentioned in a news article.

They've probably used the same valuation tools that Zoopla use to give their highly erratic and nonsensical property valuations

Edited by nome

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2 hours ago, spyguy said:

No you couldnt.

Cant speak fir zoopla but rightmoves to some imoressive software.

Its really not a matter of php and sone piccies.

Youve got 100k of property stored. Youve got 1000s of EAs uploading and changing stuff.

That's why I said 30 people. If it was just the photos and some basic stuff it would be one person in a week. It isn't doing anything that impressive, the historical data has some value but it's just because it's a known brand. Same with zoopla it scrapes and saves some useful data but nothing groundbreaking.

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Sold to a venture capital firm - those people are experts at maximising the short term return, but tend to drive companies into the wall before long.

In 5 years from now it's likely Zoopla won't exist any more - the current owners are choosing the Take the Money and Run option.

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9 hours ago, Bsmf said:

That's why I said 30 people. If it was just the photos and some basic stuff it would be one person in a week. It isn't doing anything that impressive, the historical data has some value but it's just because it's a known brand. Same with zoopla it scrapes and saves some useful data but nothing groundbreaking.

Its more than 30 people.

And youd have 100s to deal with all the EAs forgetting passwords and the the accounts.

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18 hours ago, Grab_Some_Popcorn said:

How is it worth that much!?

I think it's a gamble on a future monopoly: because the internet makes competition in these kinds of things so frictionless, there's likely to be one massive winner. It might not be Zoopla, but they're still in with a chance. There are 25 million homes in the UK. Say you have 80% market share, and a home is sold every 20 years, that's 1 million transactions a year. If you charge £50 to list each property (I have no idea if that's anything like the going rate), then a £50 million turnover company might be worth 10 times that amount. If you turn yourself eventually into an estate agent as well, and can charge £500 for each transaction, like Purple Bricks, that's £500 million in revenue, so the valuation might not be absolutely crazy.

Of course, that's a lot of if's: they might not get that monopoly position in the home advertising sphere, and even if they do, there's no guarantee they can leverage that into a monopoly in estate agency. On the other hand, maybe they can expand geographically, making £2.2 billion a bargain.

I'm not saying I'd put my own money there, but that's what I'm guessing is the logic. What's driving it is the observation that in other sectors, internetization has led to near monopoly enterprises, with huge profits, and also that there is a lot of hot money looking to make a big gamble.

It's that last bit that makes this deal feel like a "last 20 minutes of the Roman empire" thing to me (as Thorn and TJHooker noted above).

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5 hours ago, spyguy said:

Its more than 30 people.

And youd have 100s to deal with all the EAs forgetting passwords and the the accounts.

Or one person a short amount of time to implement a password reset.

It's virtually impossible to speak to anyone at Facebook or Google.

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17 hours ago, spyguy said:

No you couldnt.

Cant speak fir zoopla but rightmoves to some imoressive software.

Its really not a matter of php and sone piccies.

Youve got 100k of property stored. Youve got 1000s of EAs uploading and changing stuff.

I knew someone who worked on a train company website, took a lot longer than 30 days - many months in fact. Don't know exactly how many people worked on it, but was certainly 20+. You need architects, design guys, HTML guys, SQL guys, testers, hardware gurus and installers, and don't forget the managers.

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3 hours ago, Toast said:

I think it's a gamble on a future monopoly: because the internet makes competition in these kinds of things so frictionless, there's likely to be one massive winner. It might not be Zoopla, but they're still in with a chance. There are 25 million homes in the UK. Say you have 80% market share, and a home is sold every 20 years, that's 1 million transactions a year. If you charge £50 to list each property (I have no idea if that's anything like the going rate), then a £50 million turnover company might be worth 10 times that amount. If you turn yourself eventually into an estate agent as well, and can charge £500 for each transaction, like Purple Bricks, that's £500 million in revenue, so the valuation might not be absolutely crazy.

Of course, that's a lot of if's: they might not get that monopoly position in the home advertising sphere, and even if they do, there's no guarantee they can leverage that into a monopoly in estate agency. On the other hand, maybe they can expand geographically, making £2.2 billion a bargain.

I'm not saying I'd put my own money there, but that's what I'm guessing is the logic. What's driving it is the observation that in other sectors, internetization has led to near monopoly enterprises, with huge profits, and also that there is a lot of hot money looking to make a big gamble.

It's that last bit that makes this deal feel like a "last 20 minutes of the Roman empire" thing to me (as Thorn and TJHooker noted above).

I dont think the internet offers huge profits. Rather, it offers a low cost model that reaches out easier than previous, people heavy ways.

What people fail to grasp is the uk and brits embraces change more than most other countries.

Zoopla guves you a means to take a system tried and tested in a medium sixed country, and roll it out to other countries.

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18 hours ago, Bsmf said:

That's why I said 30 people. If it was just the photos and some basic stuff it would be one person in a week. It isn't doing anything that impressive, the historical data has some value but it's just because it's a known brand. Same with zoopla it scrapes and saves some useful data but nothing groundbreaking.

Absolutely not!

Its scale you are dealing with.

Take google - dimple ftont page. Massive engineering goes into replication, load balacing.

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6 hours ago, spyguy said:

Absolutely not!

Its scale you are dealing with.

Take google - dimple ftont page. Massive engineering goes into replication, load balacing.

Replication and load balancing is easy these days. Even deployment to over 100 servers is pretty easy, the real magic of Google is in the algorithm.

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7 hours ago, Bsmf said:

Replication and load balancing is easy these days. Even deployment to over 100 servers is pretty easy, the real magic of Google is in the algorithm.

Its easier. Its not easy.

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19 hours ago, Bsmf said:

Or one person a short amount of time to implement a password reset.

It's virtually impossible to speak to anyone at Facebook or Google.

 

2 hours ago, spyguy said:

Its easier. Its not easy.

These (examples) are all good points, but I think you're making the same argument: whether it's 30 or 300 people, it's a heck of a lot less than the 3x16000 estate agents they'll ultimately replace. Internet companies grow so fast because they need order(s) of magnitude fewer people than doing it the conventional way.

Several of my friends (and I'm guessing Spyguy as well) have made their money by destroying jobs. I'm putting that in a nasty way, and you can rightly say that it's inevitable, and it's Schumpeter's creative destruction ... but it sometimes feels pretty depressing. I say that because it's not clear to me that they (my friends) are increasing production by much: they are certainly increasing productivity, by shrinking the denominator, but it's not clear that the leaner businesses are actually making much more, and it's also not clear that the "creative" part of "creative desctruction" - the freedom of those released from previous employment to create the next generation of enterprises - is really happening.

In my darker moments, I feel that output is unaffected, and the only creation going on is a class of benefit recipients.

Edited by Toast
Fat fingers

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2 hours ago, Toast said:

 

These (examples) are all good points, but I think you're making the same argument: whether it's 30 or 300 people, it's a heck of a lot less than the 3x16000 estate agents they'll ultimately replace. Internet companies grow so fast because they need order(s) of magnitude fewer people than doing it the conventional way.

Several of my friends (and I'm guessing Spyguy as well) have made their money by destroying jobs. I'm putting that in a nasty way, and you can rightly say that it's inevitable, and it's Schumpeter's creative destruction ... but it sometimes feels pretty depressing. I say that because it's not clear to me that they (my friends) are increasing production by much: they are certainly increasing productivity, by shrinking the denominator, but it's not clear that the leaner businesses are actually making much more, and it's also not clear that the "creative" part of "creative desctruction" - the freedom of those released from previous employment to create the next generation of enterprises - is really happening.

In my darker moments, I feel that output is unaffected, and the only creation going on is a class of benefit recipients.

Well....

Things like zoopla and the like are reducing rentierism rather than plane old job destructions.

Thats a good thing.

 

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23 minutes ago, spyguy said:

Well....

Things like zoopla and the like are reducing rentierism rather than plane old job destructions.

Thats a good thing.

Yes, I agree: EA's and LA's are businesses that flow from the "mother of all monopolies", so won't be much missed. In fact, my experience of the "personal touch" offered by LA's is that the world would be a much better place were they all replaced by packet switches.

By the way, sorry for the dig, if it came across that way: I didn't intend to be rude, nor to imply that I actually know what you do (other than that you do it in Haskell).

I think the elimination of clerical and administrative roles really does fall under "creating destruction." The problem though, is that it's happening much too fast for society to absorb the numbers of the unemployed, or for people to retrain, or even to think of what they might do. If the process were happening more slowly, the culture of high employment working class (or "middle class" as we like to call ourselves) could survive unchanged, with a general sense of purpose and work-ethic intact. With too large a number of unemployed being created in certain areas, or arriving too quickly, you can get something like a phase change in society, to where dependency on benefits is seen as the norm, and not something to avoid.

In certain places, it looks like another of those "eternal September" phenomena.

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  • 336 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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