E-commerce firms either sell physical products or information-based products or services. Consistent with the theory, the findings of this study confirm that the information goods/service-based business model has a better or higher valuation (price-to-sales ratio or PSR) compared to physical goods-based model. However, the valuation gap between both types of business models reduced over years and became insignificant in the year 2001, which is the year after the dot-com meltdown. Further, we do not have any evidence of a difference in their strategy of spending on sales and marketing activities. The results of the study do confirm that young E-commerce (irrespective of the business model) start-ups tend to spend a larger percentage of their capital on marketing and advertising activities than the relatively older firms. This is consistent with their strategy of building brands on the Internet so as to capture the first-mover advantage, which is critical for the Internet technology-based E-commerce companies. We find a negative relationship between marketing expense-to-revenue ratio and profit margin. The study does not reveal a significantly strong relationship of price-to-sales ratio with size, or marketing-to-revenue ratio, or profit margin. It appears that PSR is driven by non-financial considerations.