Back of the napkin -- running the rec numbers for a gutcheck Looking at this from a financial POV is interesting. If we have a $5B rec market in 2020, and these guys keep their 30% EBITDA margin (both conservative), what market share % do they need for a one billion dollar valuation (where we are now?)
@10% discount rate, that's only a 6.7% market share. There is a first mover advantage, and a winner-take-most outcome. So, what if they end up with 20% market share? That's $3B ($21/share). Or even a 40% market share? That's $6B ($42/share).
What if they get big and good and can generate a 50% EBITDA (that's the cash metric, because profit isn't reflective of money generated)? Let's say they get here, with a 33% market share. This is the big play. That's an $8B valuation, or about $24/share.
Good times.