How is it that some people can convince investors to buy shares in
their companies for ridiculous amounts of money?

For example, let's say someone forms a company with an initial
investment of $1,000 dollars and issues themselves 1 million shares,
ie. 1,000 shares per dollar that I invested. How do they then later on
convince investors to pay much much more, say $1 a share? Is it just
because suddenly their company starts making a lot of money, and the
annual revenue times a multiple, divided by the number of shares out
there, makes the shares actually worth that much?

Three such companies I can think of are Dell and Ebay and Google. How
did their founders just start off by issuing themselves a couple
million shares for a small investment, meaning they paid very little
per share, and then go public and find their share prices go through
the roof? I mean for this to happen the companies' annual revenues at
the point the firms went public had to be already much much more than
how much they put in right?

Also, when firms go public, am I right to assume the company issues a
whole new bunch of shares for what they are worth based on this annual
revenue multiple, and that it's not the founders selling off their
stakes to make loads of money?

For my answer, if I am right and it is typically based on a multiple,
I would like you to include what this multiple is called, and how it
is calculated.

Thanks, and five-star answers get a tip!