Vonage IPO Plans: You're Joking, Right?

So Vonage thinks it's worth $2.6-billion? I wonder what kind of numbers their investment bankers crunched to come up with this pie-in-the-sky number? Vonage is a money-losing business that needs to spend heavily on marketing so it can continue to attract and retain consumers at a time when the cablecos and carriers are start to get more serious about the VoIP market. It strikes me as a desperate attempt by Vonage's investors, who have ponied up more than $400 million in venture capital, to get a decent return on their investment. Now, the $64,000 question is whether this deal will get done. Of course, it will because many institutional investors have no choice but to take a piece of this dodgy deal or risk getting cut out of the more attractive IPOs. I mean, if Corel Corp. – which “competes” against Microsoft in the office productivity market – was able to get its IPO out the door earlier this week, Vonage can do it too. If I was an investor, however, I wouldn't touch the Vonage IPO with a 10 foot pole. Caveat emptor!
Update: IP Democracy has a chart looking at Vonage's top line financials for the past 3+ years. For my post looking at Vonage's S-1 filing, click here.