Facebook worth $4 billion? It's an insult!

17.04.2009
Facebook CEO Mark Zuckerberg and his board of directors are said to have rejected an investment offer that valued the company at US$4 billion. Business reporters on which gossip is correct: Does Facebook need to cover a high burn rate, or is the company closing in on profitability?

The terms of the deal were obviously worth considering. But here's an alternate take on the rejection: Zuckerberg and his board remember speculation that Facebook predecessor MySpace could eventually be . The number came from an analyst at RBC Capital who had met with an executive from Fox, MySpace's parent company.

And while it's not a straight comparison, Skype's management landed a $2.6 billion purchase from eBay for a much smaller customer base and not much of a revenue model. By contrast, Facebook has advertisers and marketers paying real money to cover the site with ads and applications.

Zuckerberg has said some , but heavy Facebook users believe their own eyes when he says the volume of information shared on Facebook . That raises both the number of opportunities for a targeted ad, and the level of data-driven refinement that can be applied to ad targeting. At this point, the site has and is still climbing.

So, only $4 billion for Facebook? You've gotta be kidding.