# Professor Aswath Damodaran discusses what metrics to use when creating valuations for a technology company

1 Faculty News August 3, 2015 ![Bloomberg logo](/sites/default/files/styles/246w/public/assets/images/bloomberg_0.jpg?itok=qy2YlnxP)>

Excerpt from [Bloomberg](http://www.bloomberg.com/news/videos/2015-08-03/which-companies-are-worth-having-patience-for-) -- "I think that traditional metrics are a sign of laziness...You have to look at what will create the earnings in the first place. In Facebook, it's a user base and how well they're working at converting that user base into earnings. And you have to give them credit - they've taken the 1.5 billion users they have and they've been incredibly creative about making money off those users. In contrast, you look at Twitter with a 300 million user base - it's not figured out a way to convert that user base into earnings. As an investor when I look at these companies, I'm looking at what they can do to create earnings and whether they're working to put the pieces in place to create those earnings and then I look at the price at which I'd be able to buy them."

[Watch the video](http://www.bloomberg.com/news/videos/2015-08-03/which-companies-are-worth-having-patience-for-)