M&A IS Different Now -- iLike for $19-20 Million (Where Are the Zeroes)?

Yesterday, I blogged about MySpace's (News Corp's) acquisition of music social networking site iLike -- at the time, no price tag was connected to the deal. And, given iLike's popularity -- 55 million unique users -- I had anticipated a fairly healthy number for its founders, especially given the fact that a major media company was buying the site.

But, whoaaaaaaaaaaaa! According to both the Wall Street Journal and Los Angeles Times, iLike's price is a mere $19-20 million! And, this is after iLike investors -- including TicketMaster -- have pumped in $16.5 million (likely -- iLikely? -- leaving very little if anything to iLike's employees). That means that MySpace -- under new CEO Owen Van Natta -- exercised financial discipline and didn't get caught up in more typical "traditional media" behavior of throwing dollars at a deal. And, the final number -- without more zeroes attached to it -- certainly must indicate that mere popularity is not enough -- a company simply must be able to monetize its services and show good old-fashioned top line and bottom line growth to justify a healthy price tag and significant return for investors.

Champagne certainly still should flow to iLike's founders and employees. But, this deal perhaps indicates that a new financial sobriety is part of our new economic times ...