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Goldman Sachs invests in Facebook at $50 Billion valuation

dealbook.nytimes.com

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Re: Goldman Sachs invests in Facebook at $50 Billion valuation

#21

Post by vamsee »

anigbrowl wrote: post #17

Are Facebook's users worth $100 each to the company - all 500m of them? Really?

Now that you put it that way, why not? Maybe not all of them, but the high-spending ones offset the poorer ones, no? That being said, I've read earlier that Fb actively dangles the $100Bn valuation post-IPO scenario to lure new hires. So perhaps it's not entirely a surprise that GS wants in on some action.

Re: Goldman Sachs invests in Facebook at $50 Billion valuation

#22

Post by yurylifshits »

anigbrowl wrote: post #17

Are Facebook's users worth $100 each to the company - all 500m of them? Really?

Well, Google has essentially the same number of users and is traded at 190B capitalization. So, a Google user is worth over $300. As people spend more time on FB then at Google, I can understand why FB user is seen as $100 asset.

Re: Goldman Sachs invests in Facebook at $50 Billion valuation

#23

Post by vamsee »

radicaldreamer wrote: post #16
Abid wrote: post #11

Has DHH exploded yet (again)? http://37signals.com/svn/posts/2585-facebook-is-not-worth-33...

How did DHH become an authority on company valuations?

I don't think he needs to be. It's just a standard tactic at their blog. They always come off as being a bit contrarian for the sake of it. Or they just want more traffic.

Re: Goldman Sachs invests in Facebook at $50 Billion valuation

#26

Post by rumpelstiltskin »

aditya wrote: post #18

Interesting. Does anyone know how many options a newbie engineer gets at Facebook? at $50B, 0.1% of the company == $50M and 0.01% = $5M not a bad payout vesting over four years, when the stock is probably going to go up... no wonder Google is having trouble keeping talent! EDIT: This might shed more light: http://www.quora.com/Is-this-a-good-offer-for-working-at-Fac... (that says 125k options)

0.001% would be around ballpark.

Re: Goldman Sachs invests in Facebook at $50 Billion valuation

#27

Post by organicgrant »

yurylifshits wrote: post #22
anigbrowl wrote: post #17

Are Facebook's users worth $100 each to the company - all 500m of them? Really?

Well, Google has essentially the same number of users and is traded at 190B capitalization. So, a Google user is worth over $300. As people spend more time on FB then at Google, I can understand why FB user is seen as $100 asset.

Well stated argument, but I think Google (at present) is much more diverse a company product-wise, and way better at monetization in terms of screen real estate and multi-modal revenue streams. (infrastructure, ad networks, functional products, etc)

Virtual gifts aren't changing the world anytime soon.

Re: Goldman Sachs invests in Facebook at $50 Billion valuation

#28

Post by anigbrowl »

yurylifshits wrote: post #22
anigbrowl wrote: post #17

Are Facebook's users worth $100 each to the company - all 500m of them? Really?

Well, Google has essentially the same number of users and is traded at 190B capitalization. So, a Google user is worth over $300. As people spend more time on FB then at Google, I can understand why FB user is seen as $100 asset.

A reasonable point, but Google has several years' worth of results under its belt. When the IPO was conducted I think the company was valued at about $25 billion; now it has net annual earnings about $6-7 billion - so while the P/E ratio is still high, at least it's based on actual numbers. I'm not saying FB couldn't be worth even more than Google - it's just that since they've never had to file earnings statements etc. yet, all such estimates are far more speculative.

http://www.google-ipo.com/

http://en.wikipedia.org/wiki/History_of_Google#Financing_and...

http://blogs.wsj.com/digits/2010/03/04/investors-bet-on-pric...

Re: Goldman Sachs invests in Facebook at $50 Billion valuation

#29

Post by random42 »

aditya wrote: post #18

Interesting. Does anyone know how many options a newbie engineer gets at Facebook? at $50B, 0.1% of the company == $50M and 0.01% = $5M not a bad payout vesting over four years, when the stock is probably going to go up... no wonder Google is having trouble keeping talent! EDIT: This might shed more light: http://www.quora.com/Is-this-a-good-offer-for-working-at-Fac... (that says 125k options)

I don't understand how you arrived at those percentages. Facebook already has 3k+ employees.

Re: Goldman Sachs invests in Facebook at $50 Billion valuation

#30

Post by radicaldreamer »

yurylifshits wrote: post #22
anigbrowl wrote: post #17

Are Facebook's users worth $100 each to the company - all 500m of them? Really?

Well, Google has essentially the same number of users and is traded at 190B capitalization. So, a Google user is worth over $300. As people spend more time on FB then at Google, I can understand why FB user is seen as $100 asset.

Another thing that's included in Google's market cap is their technology and assets. The # of users might make up a portion of it, but it's not fair to just divide the market cap/users and come up with a figure that's easily comparable across companies.
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