The valuable part of the franchising business model is ensuring a consistent experience for the buyer. That would involve spending money to hire a considerable workforce to continuously visit and evaluate every hotel.
That would involve spending money and make it clear that the marginal costs of franchising hotels is not zero, and so it’s not worth the crazy multiples of revenue valuations that software companies are.
All of these companies are an exercise in figuring out how to create plausible deniability to justify investing in it so that it can be dumped onto a greater fool.
Comments
The valuable part of the franchising business model is ensuring a consistent experience for the buyer. That would involve spending money to hire a considerable workforce to continuously visit and evaluate every hotel.
That would involve spending money and make it clear that the marginal costs of franchising hotels is not zero, and so it’s not worth the crazy multiples of revenue valuations that software companies are.
All of these companies are an exercise in figuring out how to create plausible deniability to justify investing in it so that it can be dumped onto a greater fool.