Facebook Trade

Around October of 2007 there was a bid for facebook. I think it was from Google, but I am not sure. Anyway, the price was just slightly over 1 billion. The creator of facebook, Mark Zuckerberg (probably mispelled), rejected the bid because he valued it at 8-10 billion.

In terms of value, it is obviously uncertain and difficult to measure. Myspace was bought for several hundred thousand (600-700), so still well under 1 billion and IMO a bargain. I don't know if these social networks will act as great advertising sites though. I'm a senior in college, and I personally used facebook in the past. There were very little advertisements, however. I think it is also hard to assume that these sites will continue to grow. I think there will may come a time where people realize that facebook is incredibly unsecure and not private at all. Overall, its hard to see these business as advertisement giants.
 
Facebook can be treated as a full fledged media company like News Corp or Viacom. It has nearly the same exposure and audience as a conventional media giant, and huge revenue growth and potential. Facebook will have no difficulty selling advertising in the same way that google sells advertising, which though CPA or CPC adverting. If facebook were to go public, I guarantee within a day it would be worth $30 billion on paper. People will bid this up like a 90's dotcom, but there will be no swoon becuase facebook is such a dominant player and has such huge potential and growth.
 
Peter Thiel, early stage Facebook investor, admitted in an interview that the valuation had a range of 100 fold - i.e. it could be worth between 300 mill and 30 bill, but he had no idea where between that range. It would all depend on the further user growth & retention, and to what extent they could then monetise the users.

Good luck trying to value that. If even the founder admits the risk is of a 99% loss from peak value estimates, then it's basically a crapshoot unless you can buy it at the very bottom of that range. And we all know, in the event of an IPO, there is no way it will go for anywhere near the low end of that range.

P.S. somehow I suspect Peter Thiel has a better idea of the valuation and risk than stock_turder.
 
facebook is more then a fad. but it is getting ahead of itself.

msft really showed their desperation when they ponied up 240M to get a 1.5% stake, which values it at 15B. facebook only has a few hundred million in revenue (and most of that is from a large gauranteed ad buy from msft.......i know because i have friends who work at facebook).

anyone who understands the digital media knows that "social networking" sites are very low on ad buyers lists. just look at my space....the CPMs (how ads are priced) are rock bottom.

facebook has great traffic, but they still haven't hit on a recipe to monetize all that traffic.
 
Quote from stock_trad3r:

$100-200 billion post IPO market cap woudn't be surprising
More...



:p :p :p :p :p



You are too funny, haha, now that is just hilarious, $100-$200B based on what, some little revenue from some advertising banners....


:p :p :p :p :p
 
These social networking sites are starting to slowdown. Do you know how quick another 20 something year old can start up another social networking site and how quick it can draw attention and the other hyped site forgotten within a few months....

MSFT TOTALLLLLY OVERPAID FOR facebook, there revenue was between 100-200 million last year, how the hell can you put a price tag of over $15 Billion on that, with capital expenditures increasing they are going to have a NEGATIVE cash flow going foward, by the time they start to even generate any kind of revenue new competition will step foward and claim their spot. Facebook, if they ever go public, will be short lived, they are not another google or even a yahoo. facebook should put themselves up for sale and see which idiot pays more than a $1 Billion for it. MSFT is going to be making a HUGE mistake if they go and buy this company, remember that.
 
i know zero ad buyers that are willing plunk down big bucks on any user-generated content sites....such as social networking sites.

the reason.... big advertisers are concerned about brand image and need to know the specific nature of the content on the page where their ad will show. they don't want to pay 1M and see their ad shown next to content that either is not related, or is deterimental to the ad.

why do youthink that goog has been unable to monetize youtube? the problem is too much user-generated content.
 
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