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Friday, October 07, 2005

Casino efforts

The thirtysomething entrepreneurs behind PartyGaming are worth $2bn each. Not bad for a pair with backgrounds in pornography and computer programming, writes Patrick Hosking

If you want a picture of the service company of the future, look no further than PartyGaming. In the next few days, this online poker company will float on the London Stock Exchange. Eight years ago, it was a mere gleam in the eyes of its founders - the former porn entrepreneur Ruth Parasol and the computer program whizz-kid Anurag Dikshit.

PartyGaming expects to be valued at between £4.4bn and £5.1bn ($9.3bn). That would give it a price tag similar to blue-chip companies such as Boots or Sainsbury's or ITV, and considerably higher than British Airways or Dixons.

We all know how quickly the apparent value of a business can be destroyed. The $80bn tag for Enron evaporated in weeks as the fraud relating to that company unfolded. But wealth creation can be quick and spectacular. The prospect of large and growing profits can put eye-watering valuations on the youngest of businesses.