Estimated Value: $1.25 billion
Business: Social network and virtual world for teens.
Location: Helsinki, Finland
More Info: About Habbo
CEO (of parent Sulake Corp.): Timo Soininen
Investors: Movida Group, Taivas Group, 3i Group, Elisa Group, Benchmark Capital
Analysis: Habbo is a virtual world site for teens: 70% of users are between 13 and 16. Habbo has about 10 million uniques per month, and 94 million registered users in 32 countries. Habbo is deeply addictive: The average user spends 40 minutes on the site. Parent company Sulake marketing VP Teemu Huuhtanen says over 200 advertisers advertise on the site
We believe Habbo posted about $75 million in revenue in 2007, and we expect that number will exceed $100 million in 2008.
We estimate that Habbo has a high gross margin and should ultimately generate an operating margin of about 30%. Applying a revenue multiple of 10X-15X to the 2008 figure, we estimate the company is worth $1.25 billion.