ET carries an article today on potential accounting and legal risks in the Indian ecommerce space. I doubt if entrepreneurs and investors would allow such subversions. People know well that this road doesn’t lead to heaven. Read on
On a business level, the lifetime value notion is well understood and used – and in my view is the appropriate way of looking at direct user acquisition costs. As an investor, that is the conversation I want to have with entrepreneurs to understand the health of the business at a nascent stage. Accounting is supposed to be, and should continue to be more conservative – I do not think investors are valuing early stage companies on basis of their accounting profits in any case.
The views expressed on this site are personal views of Alok, and do not constitute an offical opinion of any company or organization.