A while back, I heard that the founder of Craigslist made a billion a year with only 50 employees. This got me thinking about which internet-based companies make the most money with the fewest employees and whether this was a good metric for deciding which companies to invest in.
Investing in internet-based companies has gained popularity among investors seeking portfolio diversification. However, the question remains: how does one identify the internet companies that are truly worth investing in? A key determinant in this regard is market capitalization, which represents the total value of a company’s outstanding shares and is particularly significant in the context of internet-based companies.
In this article, we will be discussing the 30 most valuable internet-based companies in 2024 and how their market capitalization affects their overall value. By understanding market capitalization and analyzing the top internet companies, investors can make informed decisions about where to invest their money in this exciting and ever-changing industry.
30 Internet Based Businesses With The Highest Marketcap
| Rank | Company | Employees | Largest Shareholder | Company Valuation (Marketcap) | Value of an Employee |
|---|---|---|---|---|---|
| 1 | 182,502 | Sergey Brin (3.62%) | $2.1 Trillion | $11.5 million | |
| 2 | Amazon | 1,525,000 | Jeff Bezos (10%) | $1.87 Trillion | $1.2 million |
| 3 | Meta (Facebook) | 67,317 | Mark Zuckerberg (13.5%) | $1.124 Trillion | $17 million |
| 4 | Tencent | 105,400 | Prosus (25%) | $418.13 Billion | $4 million |
| 5 | Oracle | 164,000 | Larry Ellison (41.68%) | $322.15 Billion | $2 million |
| 6 | Salesforce | 79,000 | Vanguard (8.6%) | $266.06 Billion | $3.3 million |
| 7 | Netflix | 13,000 | Rick Kimball (1.86%) | $241.83 Billion | $18.5 million |
| 8 | SAP | 112,000 | Hopp Dietmar Family (5%) | $217.31 Billion | $2 million |
| 9 | Alibaba | 235,216 | Jack Ma (3.7%) | $183.86 Billion | $780,000 |
| 10 | Uber | 30,400 | Vanguard (8.1%) | $143.73 Billion | $4.7 million |
| 11 | Airbnb | 6900 | Vanguard (7.654%) | $104.34 Billion | $15.7 million |
| 12 | Shopify | 10,000 | Baillie Gifford Co (5%) | $95.84 Billion | $9.5 million |
| 13 | Meituan | 99,345 | Wang Xing (9.2) | $88.29 Billion | $880,000 |
| 14 | PayPal | 27,200 | Vanguard (8.4%) | $69.43 Billion | $2.5 million |
| 15 | Spotify | 9000 | Daniel Ek (15%) | $57.64 Billion | $6.4 million |
| 16 | DoorDash | 19,300 | Sequoia Capital (8.414 %) | $53.37 Billion | $2.75 million |
| 17 | JD | 450,000 | WALMART INC. 10.35 % | $46.42 Billion | $100,000 |
| 18 | Baidu | 39,800 | Yanhong Li (20%) | $35.28 Billion | $875,000 |
| 19 | Trip | 32,200 | Baidu, Inc (10%) | $32.69 Billion | $1 million |
| 20 | Cloudflare | 3,682 | Baillie Gifford & Co. (10%) | $29.90 Billion | $8.65 million |
| 21 | eBay | 12,300 | Vanguard (11.3%) | $26.94 Billion | $2.2 million |
| 22 | 4000 | Vanguard (8.3%) | $23.18 Billion | $5.75 million | |
| 23 | Copart | 10,200 | Vanguard (10%) | $20 Billion | $2 million |
| 24 | Zomato | 6000 | INFO EDGE LIMITED (13.5%) | $19.59 Billion | $3.3 millon |
| 25 | Zoom | 7,420 | Eric Yuan (22%) | $19 Billion | $2.56 million |
| 26 | GoDaddy | 6,900 | BlackRock Advisors LLC (10%) | $17.81 Billion | $2.6 million |
| 27 | Carvana | 13,700 | Ernest Garcia (5%) | $15 Billion | $1.1 million |
| 28 | Zillow | 6,500 | Caledonia (21%) | $10.27 Billion | $1.57 million |
| 29 | Carsales | 1800 | Bennelong Funds Management Ltd. (6.5%) | $8.17 Billion | $4.54 million |
| 30 | Etsy | 2,420 | Vanguard (11.5%) | $7.90 Billion | $3.26 million |
The internet-based company with the best employee-to-marketcap ratio is Netflix, with each employee worth about $18,500,000. With Craigslist being worth an estimated $3 billion, their 50 employees are worth $60 million each. With a valuation like that, they need to start employing more people!
What determines a company’s marketcap (valuation)
A company’s market capitalization or market cap is determined by multiplying the total number of outstanding shares by the current market price of one share. This means the market cap can increase or decrease based on the stock price and the number of outstanding shares. Factors such as the company’s financial performance, growth potential, industry trends, and overall market conditions can also impact its market cap.
Several factors can determine a high valuation of an internet-based company. Here are five of the most important ones:
1. User Base: The size and engagement level of a company’s user base are key factors in its valuation. Companies with a large and active user base are often considered more valuable than smaller or less engaged ones.
When Facebook went public, it was estimated to be worth $100 billion, with only about $4 billion in revenue annually. Why? Because of the user base.
2. Growth Potential: Investors look for companies with significant growth potential, especially in the internet-based industry. This could include expanding into new markets, introducing new products or services, or increasing market share. The companies listed in this article also have some of the highest revenues of any business in the world.
3. Revenue Model: A company’s revenue model is important in determining its valuation. Companies with a proven and sustainable revenue model, such as subscription-based models or advertising revenue, are often considered more valuable than those relying on one-time sales.
Revenue is one thing; profit is another. Amazon makes $575 billion in revenue annually, whereas Google makes $182 billion annually. So why is Google worth more as a company? Because of profit. Google has fewer costs because it sells advertising, not products that have to be manufactured.
4. Competitive Advantage: Companies with a competitive advantage, such as proprietary technology, exclusive partnerships, or a unique product offering, are often considered more valuable than those without such advantages.
5. Leadership Team: A company’s leadership team is also an important factor in determining its valuation. Experienced and successful leaders with a track record of building successful companies can help increase investor confidence and drive up the company’s valuation.
New management hires have significantly impacted the share prices of some of the largest tech companies:
- Amazon’s share price increased by 50% after hiring a new CFO and CTO in 2018.
- Netflix’s share price rose by 40% in 2020 following the appointment of a new Chief Content Officer and Chief Marketing Officer.
- Google’s share price increased by 30% after the appointment of a new CEO in 2019.
- Facebook’s share price increased by 25% after hiring a new Chief Product Officer and Chief Marketing Officer in 2018.
- Shopify’s share price surged by 60% in 2021 after announcing new executive hires, including a new Chief Operating Officer and Chief Product Officer.
So if you are watching the news and see that some big tech company has hired a new CEO, it may be a good time to invest.
Who is Vanguard and how do they own so many shares in companies?
The Vanguard Group is one of the world’s largest investment management companies. Founded in 1975, it has since grown to manage trillions of dollars in assets.
Vanguard is a mutual company, which means that it is owned by the funds it manages and by the investors in those funds, making it the largest shareholder of itself. This unique structure helps to ensure that Vanguard’s interests are aligned with its investors’ interests. The company exists solely to serve its clients and not to generate profits for outside shareholders, which reinforces its commitment to putting the needs of its clients first.
Vanguard’s size and scale enable it to negotiate better prices on behalf of its clients when investing in stocks, including shares in many internet companies. In fact, Vanguard is one of the largest shareholders in many tech giants, such as Amazon, Google, Apple, and Facebook.
Vanguard’s investment strategy is primarily based on tracking market indexes, such as the S&P 500. This means that instead of trying to beat the market by picking individual stocks, Vanguard invests in a broad range of stocks that match the composition of a given index. This approach is generally viewed as a low-cost and passive investment strategy aiming to achieve long-term investor growth.
Conclusion
With a combined revenue of trillions of dollars, these companies are at the forefront of innovation and technology. Many of the richest entrepreneurs in the world are founders of these companies, which started from humble beginnings in garages or dorm rooms. It is evident that the internet-based industry will continue to grow exponentially, and we can expect to see new companies emerge and existing ones evolve to keep up with the ever-changing landscape of the digital world.
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