Yesterday I received two separate calls from Silicon Valley types, taking me (and my media peers) to task for expecting Snap's IPO to be "successful." In short, they don't believe the numbers add up.

"Successful" is a tricky term when it comes to IPOs, particularly since different companies list for different purposes (capital raising, employee liquidity, market cachet, etc.). But these folks were essentially saying that if Snap does manage to price at around a $20 billion valuation (fully diluted), it will have a very difficult time maintaining that past the lock-up period (at least for a while).

Basically it's a math question. If Snap is unprofitable and generated around $400 million in 2016 revenue (which is a reported estimate, not a fact), then it would have to trade at a 50 multiple of revenue. There have been some rumors that Snap had a bang-up Q4 that could push the total closer to $600 million, but even that would mean in excess of 33x.

For comparison's sake, Facebook went public in 2012 at around a 23x revenue multiple, and that company already was generating $1 billion in annual profit. Today, Facebook is at only 12.9x revenue.

Obviously the argument here will be growth curve, but how long will public equity investors be willing to value eyeballs over dollars? Particularly without voting rights? Even if you accept projections that Snap could hit $1 billion in revenue next year, the base IPO valuation of $20 billion would still be nearly 2x where Facebook is currently trading, and that's assuming shares don't budge a cent.

None of this is to say that Snap won't surprise all of us when its financial do become public, or that it won't grow into its valuation over time. But it is to say that the company's valuation rocket may need to take a breather.

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Updated 37 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Annelise Capossela/Axios

  1. Global: Total confirmed cases as of 11:30 a.m. ET: 20,126,452 — Total deaths: 737,285 — Total recoveries: 12,380,410Map.
  2. U.S.: Total confirmed cases as of 11:30 a.m. ET: 5,098,452 — Total deaths: 163,533 — Total recoveries: 1,670,755 — Total tests: 62,513,174Map.
  3. States: State testing plans fall short of demand — National Governors Association's bipartisan leaders express concern over Trump's unemployment order.
  4. Axios-Ipsos poll: 1 in 2 has a personal connection to COVID-19.
  5. Business: Moderna reveals it may not hold patent rights for vaccine.
  6. World: New Zealand reports first local cases for 102 days — Why you should be skeptical of Russia's vaccine claims.

Exclusive: Facebook cracks down on political content disguised as local news

Illustration: Eniola Odetunde/Axios

Facebook is rolling out a new policy that will prevent U.S. news publishers with "direct, meaningful ties" to political groups from claiming the news exemption within its political ads authorization process, executives tell Axios.

Why it matters: Since the 2016 election, reporters and researchers have uncovered over 1,200 instances in which political groups use websites disguised as local news outlets to push their point of view to Americans.

2 hours ago - Technology

Nationalism and authoritarianism threaten the internet's universality

Illustration: Aïda Amer/Axios

Governments around the world, prompted by nationalism, authoritarianism and other forces, are threatening the notion of a single, universal computer network — long the defining characteristic of the internet.

The big picture: Most countries want the internet and the economic and cultural benefits that come with it. Increasingly, though, they want to add their own rules — the internet with an asterisk, if you will. The question is just how many local rules you can make before the network's universality disappears.