What’s in a number?

Numbers Game
Having looked at the figures quoted by the Beagles, a certain pattern begins to emerge. There are certain numbers they like to quote and one can’t help but wonder whether there is a certain meaning behind them.

Back in 2013 there were 35,000 members and Legal Beagles was allegedly going to be sold for £35 million. No idea whether that was an alleged offer or an alleged valuation or an opium dream but that was the rumour being spread by the owners themselves.

In 2015, when there were 70,000 members, the Beagles allegedly turned down an offer of £7 million, or that was how much the site valuation was. As usual, it wasn’t clear, but that’s what the two articles state.

While the number of members doubled in those two years, the alleged valuation was just one fifth of the one from the time when there were just half the number of members. Obviously none of this would be relevant if the whole thing was just a hoax, however, the numbers in themselves are far from random, there is a relationship between them. This would probably indicate that the site owners themselves are coming up with those figures, which they somehow tie in with the number of members. Of course we know that not all members are active, in fact, the majority are not, but, as we have seen here, it’s a numbers game and quantity goes above quality.

The following comment sums it all up quite accurately.

It’s a rather blinkered notion that private equity would value a website by reference to the size of its membership. The primary consideration would be its metrics eg visitor traffic and search engine optimisation performance relevant to the subject matter of the proposed business model whether that be advertising, lead conversion or whatever. Elliot Contador

8 Comments

  1. Jon says:

    These figures are almost certainly a bit of creative accounting. Maybe there have been 70000 registrations however when you take off the ones who sign up and post once or maybe twice, those that are spammers-how many a day are banned, what are you left with, a much smaller number I suspect. If you then look at people who haven’t posted for say 3 months, the number will be even less.

    If you look at how many people post in a week I am sure that is has at least two less noughts on it

    • Legaleaglet says:

      Of course! That’s precisely the subject of my other posts such as the numbers game and quantity over quality. You may remember that, a few years ago, you were able to see the full LB members list as you can do on other forums. When you went there, you’d find most members had posted just once or twice, some as far back as 2007, and never again. Others had zero post count. Banned members (spammers or not) were excluded from the members list, so the reason those people never went back wasn’t because they were banned. Banned users would count towards the total member count though, the only ones who wouldn’t count are those whose profiles have been deleted and whose posts appear under “guest”. Some sites delete the spammers’ accounts rather than just leaving them banned but this is optional.

      I still find it hard to believe that the actual membership base would have doubled from 2013 so I suspect they may well just leave the spammers banned rather than deleting their profiles. There are also some beagles who have had more lives than a cat and AEs are not deleted.

      What I find significant is the correlation of the numbers with the alleged valuations and/or offers. If they were all true, then the site would have dropped in value to just a fifth of what it was “worth” in 2015, and the value per member would be a tenth of the 2013 figure, which would make no bu$ine$$ $en$e what$oever. The £350,000 investment in LB Compare would be just 1% of the value of the site in 2013. The figures just don’t add up!

  2. revenge says:

    Do you think that the 7 investors could be the very companies they are comparing so as to ensure that they will get new business as the compare site will almost probably put them forward so they get the business? Just my thoughts……….

    • Legaleaglet says:

      That could well be the case although it wouldn’t be a very honest comparison if it was. There’s also various types of “comparison site”. If you are just comparing how much it would cost to do the same thing using different companies it’s a straightforward price comparison such as when you look at electricity providers. In that case, even if one of the companies was behind the site, you would still get accurate data.

      Ratings and reviews are a totally different thing. Anyone can write a review and the public would have no way of verifying that the reviews are real, just like the testimonials you often find on some website (mostly American ones) saying how wonderful their offering is, which reminds me of the video Legal Beagles have been showing to promote their new venture. If the site offers ratings and reviews and any of the compared companies were funding the site, it would not only be unfair on the customers but also on the other participants themselves.

  3. Jon says:

    When I consider the reviews I remember a Watchdog article about the website TripAdvisor . They changed the wording because it was clear than many reviews, both positive and negative were bogus.

    • Legaleaglet says:

      Yes, I remember hearing something like that. However, in that case the bogus reviews would have been from either competitors (the negative ones) or people associated with the establishments being reviewed (the positive ones). Tripadvisor as such wouldn’t have been behind the bogus reviews, only it’s not easy to verify each and every reviewer.

  4. Jon says:

    Sorry to be clear I wasn’t suggesting that anyone would set out to defame or wrongly promote and firm on the compare site , my point was that without strict controls , how valid are any recommendations or negative reviews

    Naturally the same could be said of this blog although I believe that the very vast majority of comments can be backed up with proof

    • Legaleaglet says:

      When you have a site where anyone can post reviews, it’s not easy to verify each and everyone of them, and there’ll always be those who may wish to abuse the system. However, it would be different if a site was backed by firms or companies who are also subject to ratings and reviews on the same site, as opposed to just a plain comparison of services.

      There is always a certain amount of speculation and, where that’s the case, I think it has been clearly stated on here. This is an open posting platform and if we’ve posted something that’s factually wrong -which could well be the case because no-one, other than the parties involved, knows the full story, then they are welcome to post a correction.

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