What’s Your Data Worth?

Many businesses don’t yet know the answer to that question. But going forward, companies will need to develop greater expertise at valuing their data assets.

James E. Short and Steve Todd

SPRING 2017

In 2016, Microsoft Corp. acquired the online professional network LinkedIn Corp. for $26.2 billion. Why did Microsoft consider LinkedIn to be so valuable? And how much of the price paid was for LinkedIn’s user data — as opposed to its other assets? Globally, LinkedIn had 433 million registered users and approximately 100 million active users per month prior to the acquisition. Simple arithmetic tells us that Microsoft paid about $260 per monthly active user.

Did Microsoft pay a reasonable price for the LinkedIn user data? ...