

Facebook rejects funding at $4 billion valuation, may not raise more - drusenko
http://venturebeat.com/2009/04/15/facebook-rejects-funding-at-4-billion-valuation-may-not-raise-more/

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ctingom
_Facebook made under $300 million last year, was a little shy of breaking
even, and at first expected to make towards $400 million in revenue this year.
But the company said in late March — incidentally at the time that chief
financial officer Gideon Yu left the company — that it was beating projections
by 70 percent. I’ve confirmed that this run rate has the company possibly
breaking half a billion in revenue by the end of the year._

If that's true, it's remarkable.

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ajju
What are they making money off? I have never heard of anyone clicking an ad on
facebook. (conversely I have met few Internet users who have NOT clicked a
Google ad)

They could be selling data/information. If so, I hope it's anonymized.

~~~
cellis
full disclosure: I build/make money from facebook apps

 _Facebook made under $300 million last year, was a little shy of breaking
even..._

Why is this surprising to so many? There are dozens of _developers_ that are
netting 100k+ a month (yes i actually talk to one of them quite often), and at
least half of this is from ads. Facebook is the largest social network in the
world and growing at about 1 million users a day; why is it a surprise that
they are actually almost break even?

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JabavuAdams
Good for you! It's not so great for Facebook's investors, though.

FB: Hi, we're a conduit that funnels small sums of money from millions of
people into a smaller number of developer's pockets.

Investors: So, how much of that do we get?

FB: Um. Almost 0, but we're working on that.

Investors: ...

~~~
byrneseyeview
Surely the same could be said of Google. Their revenue is some tiny fraction
of 1% of the value they create for users.

~~~
JabavuAdams
Google makes more money than it spends. Facebook does not (yet). This is a
crucial difference.

> Annual income twenty pounds, annual expenditure nineteen six, result
> happiness. Annual income twenty pounds, annual expenditure twenty pound
> ought and six, result misery.

\-- Charles Dickens

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elai
Facebook apps and ads appeal to a market very far away from us tech guys so it
can be hard to think of how it works. Think of things as random as bored at
home fat housewives and Swedish people as your money makers. Also facebook ads
can be hyper local, because people in facebook tend to actually put accurate
information in! Imagine local businesses and organizations advertising their
cancer runs, concerts or what not.

~~~
gaius
Hmm, yes and no. Facebook ads are generally well targeted, I think. I get ads
mainly for diving and snowboarding (which I have followed), dating (I am
single and looking, not quite ready to take the plunge into online dating yet
tho') and fitness (and I know those "get a six pack" ads are all scams, but
showing them to me is a reasonable decision by the algorithm). I also get
"become a fan of X" as sponsored ads which is just plain stupid.

Google's ads seem to be simple keyword matches and are context-free, I think
Facebook could have the edge here, but they really do need to get rid of the
scammers _and_ actually pay attention to feedback (e.g. if I flag an ad as
uninteresting, FB is wasting my time and its advertiser's money by showing it
to me ever again).

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psranga
I'm a little puzzled by the skepticism about Facebook's utility. I don't know
about you guys, but losing touch with old friends is something I feel bad
about all the time. Facebook let's you keep informed in a shallow way about
people who you don't meet often (enough). That's certainly better than being
uninformed.

I would actually pay a small amount for something like Facebook.

If you build something with utility, usually it's possible to derive value.

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fiaz
Interesting...does this mean that Facebook will only accept funding for
nothing less than $15 billion?

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nreece
_Facebook made under $300 million last year..._

How?!

