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This is why I love software companies: Revenue per employee. The beauty of software businesses is their leverage. Google's market cap is 40% larger than Walmar
by therealarmen 13y ago
This is why I love software companies:
Revenue per employee. The beauty of software businesses is their leverage. Google's market cap is 40% larger than Walmart but it has only 2% the size of Walmart's employee count.
- johnrob 13y agoThe true measure of a company is how much profit it produces. Why does revenue per employee matter?
- thwarted 13y agoIt's a measure of efficiency. A company that takes 100 people to produce $100 of profit isn't as efficient as a company that produces $100 of profit with one person. How this ratio changes over time is a measure of scalability. If a one person company goes from $100 profit to $200 profit after doubling the number of people, that's more scalable than a 100 person company going from $100 profit to $200 after doubling the number of people.