

Facebook Crosses 300 Million Users and is Cash Flow Positive - aston
http://www.techcrunch.com/2009/09/15/facebook-crosses-300-million-users-oh-yeah-and-their-cash-flow-just-went-positive/

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brk
Does anyone have any actual stats/data on this, beyond Facebook's own vague
statement and the Techcrunch hype?

Cash flow positive at any point in time, even sustained for a few quarters,
does not equate to "profitable". They have raised almost a quarter billion
dollars. Their investors would likely want a multi-billion dollar equity event
out of this, if that were even possible.

Facebook has become very deft at public relations in the last few years.
Things like the "$15B USD Valuation" spin when Microsoft bought some ads are
one example. I am very hesitant to believe that this announcement is anything
more than PR based off of something like "well, if you look at the numbers
just right at a point in time we can claim to be CFP...".

~~~
tokenadult
_Cash flow positive at any point in time, even sustained for a few quarters,
does not equate to "profitable". They have raised almost a quarter billion
dollars. Their investors would likely want a multi-billion dollar equity event
out of this, if that were even possible._

Those are very important financial points. It seems to me that the real estate
business in the United States was largely cash-flow positive as recently as
three years ago, three years after I was sure that it was all a bubble.

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sfphotoarts
amazing, 300 million people can see something I can't. Am I the only person
working in the tech field not to have facebook?

Congratulations indeed, what an amazing scaling success story. Every statistic
I read about them is staggering.

~~~
makeee
There's nothing all that special about it. If all your friends/acquaintances
are on it then it's great, otherwise it's not that useful. If all my friends
were on twitter then I'd probably be using that instead.

~~~
unalone
I know that in this thread I'm playing the part of the outspoken Facebook
fanboy, but: They entered a market competing against a site that was at a time
the fourth-most used site on the planet, and in three years usurped its
position, introduced an entirely new paradigm to how web sites worked, swiftly
and mercilessly eliminated the trend towards theme personalization, redefined
their design three times, added a slew of features that were ripped off by
every site around them, and did it all without compromising its theme of "We
know what we're doing, fuck you" and generally being right.

~~~
codexon
For the most part I think Facebook's success can be attributed to these
factors rather than any groundbreaking inventions.

1\. Ivy League beginnings. It was easy to scrape together an audience due to
the Ivy league exclusivity at the beginning. This solved the chicken and egg
problem in a field dominated by MySpace, LJ, Friendster, Xanga, et al.

2\. Harvard background: its easier to raise funding just because of the name.

3\. MySpace's utter lack of progress especially by the time it was bought out
by Murdoch.

~~~
unalone
I couldn't disagree more. Facebook did several incredible things.

~~~
codexon
I will have to disagree with you. Their biggest technological achievement was
the Facebook app platform.

While this was indeed an "incredible" thing, the question is, did this help
make Facebook what it is today, or even attract a sizable audience?

The answer is most resoundingly no. Facebook was already very popular by the
time most of these unique things were made, and in the case of Facebook apps,
it even put off some users who were annoyed by its spammy nature.

~~~
unalone
They haven't done things perfectly (apps), but they did a few things that were
enormous, not technologically but conceptually. They had a few incredibly
brilliant ideas that made them as lasting and as sticky are they are.

~~~
Retric
Face book is going to be "dead" (ok, shrinking) in 10 years. If you look at
social networks they are only sticky in the short term. Facebook's growth has
hidden the fact that the average user does not stick around for 2 years and at
300 million users they just can't keep replacing people. And as people stop
showing up it becomes less useful to those who stick around.

The pattern is simple, a new site shows up that let's you exchange info with
people you have not talked to in a while. So you sign up and chat for a while,
but you don't really care about those people so after a while going to the
site becomes an annoying time sink and so you drop it. For a site that just
has your core friends. But then you don't talk to people for a while and...

The only long term niche is to become the psudo holiday site, where people
occupationally show up to chat with their extended social graph, but you don't
really spend much time there. So, lot's of people, few page views.

PS: The people that "love" social sites and want to keep up with all their
friends will jump ship as soon as something else becomes popular with most of
their friends.

~~~
netsp
Time will tell I suppose. You may be right but Facebook's size and appeal
outside of the normal social networking site market might make it different.

~~~
Retric
True. However, I don't have 10 thousand friends so I am not positive how shear
size is all that important.

~~~
unalone
Size doesn't matter. Utility does. If Facebook were to start completely over
again against the current competition, I think they would still rise to
prominence without much trouble.

What makes Facebook different, in short, is that while other services offer a
_place_ to talk, Facebook is built as a _utility_ in a way other sites aren't.
It's the new big communication medium. The people that use it are using it as
a replacement to email and IM. That's a huge deal, because it suggests
Facebook has the potential to last as long as email has.

Your suggestion that people abandon things all the time is countered by AIM,
which has been the prominent IM service for a decade.

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fjabre
I would love to understand what the 300 million number actually means. Does
that mean they've signed up 300 million users but only half are active or some
other percentage or do they actually have 300 million active users..?

Active = logs in once a week?

~~~
bdr
Facebook stopped measuring inactive users a long time ago. Anything you hear
out of them refers to active users.

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secret
So approx. the equivalent of the entire US population is active on Facebook?

~~~
unalone
Yes.

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georgekv
Some stats to consider:

<http://www.facebook.com/press/info.php?statistics>

~~~
ironkeith
"More than 6 billion minutes are spent on Facebook each day"

Jeez, think of all of the valuable things that time could be used for instead
of "looking at picture of people I don't know, but did go to high school
with". _sigh_

~~~
mediaman
It's not clear that it was replacing productive time.

~~~
ironkeith
I never implied it was. Only that it could have been. Wasting time is a pet
peeve of mine.

~~~
joubert
Socializing with your friends a waste of time?

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pizza
So, now facebook would theoretically be the 4th most populous country. Damn.
Countries like China and India have been around for thousands of years. And
then, 3rd up, America: under 300 years. And facebook: 4 years.

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unalone
Congrats to Facebook (and to the Facebook employees on HN)! This is exciting
news and somewhat unexpected.

~~~
drusenko
it's only unexpected if you've been solely listening to the "facebook sucks"
and "facebook is a bubble" bandwagon that seems to be particularly prominent
here on HN. there's been tons of news about their high revenue numbers lately
and they've been approaching cash-flow positive for a long time now.

~~~
unalone
I was actually in the middle today of writing an essay about why Facebook
isn't a fad, to counter that attitude a bit. I knew they had improved their
revenue significantly, but I was under the impression that they had a ways to
go.

~~~
seiji
What is a fad? Is their staying power in line with IBM or AOL or are they
something completely new an unexpected?

If we define fad as "something that exists, becomes engrained as 'the way' or
a 'hot item' in the vernacular for a period of time, then fades away"
everything is a fad. IBM still exists, but their fad period is over. The same
goes for AOL.

The services may not be fads, but their periods of rampant popularity are. All
the talk and attention will fade when people discover the next big thing to
coddle their self esteem and egos.

~~~
unalone
I'm almost done with writing this thing! I explain better what I mean there,
so hopefully you'll forgive me for waiting another hour or two and posting
that.

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mixmax
I wonder when HN will be cashflow positive :-)

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icey
Do you mean HN or YC?

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mixmax
It was a joke, since the goal of HN is not to make money. It wasn't very well
received though...

~~~
zandorg
I once joked that HN could be sold like Reddit, and someone said it was a fair
idea.

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zepolen
Is their revenue entirely ad based?

~~~
unalone
They also let users send virtual gifts to one another for really low prices.

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blasdel
'gifts' being 64x64px icons that have been _curated_ by Facebook staff.

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whatusername
Actually - someone pointed out to me recently that a 64x64px flower lasts a
whole lot longer than a chocolate bar.

~~~
unalone
The question is which provides greater value to you while it lasts.

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daniel-cussen
Cash flow + means now web 2.0 ambitions are defensible.

~~~
unalone
Nah, web 2.0 was about the power of the social mind and collectivism. Facebook
was actually one of the first sites to reject that mindset and focus on
walling off their users. When I wrote for AllFacebook in 2006 I think I
actually wrote something arguing they were closer to Tim O'Reilly's idea of
web 3.0 or the semantic web, wherein all information is easily related to
other information.

~~~
daniel-cussen
What I meant is that being cashflow positive means the new generation of web
companies has a successful example to look to.

