In the SmartUp methodology, assets are defined by what actually creates value and sustainability. Yonatan Stern emphasizes that while technology or patents may exist, they are often not the primary source of value.
Customers and users are presented as the biggest asset of a company. Lecture 9 explicitly asks, “What is the biggest asset of a company?” and concludes that customers and users are the main drivers of valuation. Stern illustrates this by analyzing acquisitions such as LinkedIn, WhatsApp, and Waze, calculating the price paid per user. The logic is that customers are extremely difficult to acquire, so acquirers are willing to pay a premium for an existing user base. Stern advises founders to “own their customers,” because the relationship is the real asset, while technology can often be replicated.
In operational terms, the team is described as the most important asset. Since 70–80% of a technology company’s expenses are salaries, the team represents the company’s execution capability. Stern notes that building a team is complex because each individual is unique, making human capital a critical but volatile asset.
SmartUp also places strong emphasis on intangible assets such as data and brand. In cases like ZoomInfo and TikChak, building large databases is described as creating a “huge asset” or an “interesting asset” that enables multiple revenue streams. Brand is treated as an independent asset with high value. Stern cites ZoomInfo’s acquisition, where the brand name was retained because it was significantly more recognized than the acquirer’s brand.
Finally, SmartUp frames a profitable company itself as an asset, similar to real estate. A company that generates profit is compared to an apartment that yields rent – it is a cash-yielding asset. Because it produces predictable returns, it attracts buyers and makes exits more predictable than speculative unicorn valuations.
In contrast, inventory is discussed as a costly asset. While it appears as an asset on the balance sheet, holding inventory incurs ongoing costs, and poor management of this asset can lead to major losses.
