Wow. I just read that Disney just paid $350 Million upfront for ClubPenguin.com, a site that allows kids to customize penguin characters, and then chat and play games with other characters. And Disney says that it will pay them another $350M at the end of 2009 if their growth projections are met.

With 700,000 members paying $5.95/mo. that’s a nice sales price whoever negotiated that. Warren Buffet does say that you should be able to sell your business for up to 10 times the annual revenue, which would make it $500,000,000. So, both sides did a great job negotiating. If the projections are met, the founders get $700M for 2 years of work (founded in 2005). And if the projections are not met, Disney gets a nice discount.

Source: NY Times Article