Peter Thiel Sells Majority Of His Facebook Shares In Deal Planned Pre-IPO • Hacker News Board

Re: Peter Thiel Sells Majority Of His Facebook Shares In Deal Planned Pre-IPO

#91

Post by freehunter » Tue, Aug 21, 2012, 2:43 PM UTC

J-H wrote: post #27

aasarava wrote: post #25

Everyone keeps focusing on Facebook as an ad platform, and pointing to the difficulty in monetizing mobile via ads. But I'm betting Facebook is on the brink of rolling out a digital wallet. They already act as an authentication/identity service with hundreds of millions of users. If those users linked their FB accounts to their bank accounts, they'd be able to buy anything on any integrated website that they log into…

The problem here is would you trust Facebook with your wallet? I wouldn't, and I'm betting most wouldn't after all of Facebook's Privacy gaffes.

The thing is, those privacy incidents weren't gaffes: they were intentional. As far as I know, Facebook has only had one unintentional mistake when they accidentally DoS'd themselves. There might be more I'm forgetting, but the point still stands. Facebook didn't reset people's privacy settings by mistake.

Getting into payment processing will expose them to SOX and PCI compliance. They'll still be able to reset your privacy settings for your profile, but they'd be sued out of business if they did something like that for your payment profile. No matter how much it looks like they do, Facebook rarely makes mistakes.

Re: Peter Thiel Sells Majority Of His Facebook Shares In Deal Planned Pre-IPO

#92

Post by jamesaguilar » Tue, Aug 21, 2012, 3:42 PM UTC

rootedbox wrote: post #90

jamesaguilar wrote: post #81

Earlier quoted context omitted.

A) he has sold a good portion of it. B) Berkshire Hathaway is a holding company. It is diversified already. So there is much less of a need to sell it.

So you're saying Berkshire Hathaway is much better setup as a long term business than Facebook; therefore a better investment. I don't disagree at all.

No, being diversified doesn't instantly make you a better business. But it does make you a safer investment.

Re: Peter Thiel Sells Majority Of His Facebook Shares In Deal Planned Pre-IPO

#93

Post by r00fus » Tue, Aug 21, 2012, 6:17 PM UTC

ThomPete wrote: post #12

r00fus wrote: post #8

Earlier quoted context omitted.

> 2. They haven't found a way to make advertising work on mobile, an increasing part of their visits. And herein is the problem: Apple - Apple is so against advertising that they created their own iAd network to keep other companies out of the game (it doesn't have to really be a success - just enough to keep devs off competing ad networks). As long as Apple is influential in the mobile world, Google and Facebook are…

Hmm Actually I think the problem is bigger than that. Android is a more popular mobile OS than iOS by far and in fact googles reason for approaching it that way is that they want a platform to serve ads on. But so far they havne't managed to find a way to do it.

I think monetization would require near-monopoly-level control for Google. How much would adwords bring in if Google weren't the "default search" destination?

If Google can basically kick Apple back into niche status (not there yet), then they could extract monopoly rents on a defacto standard of ad-based apps either using Google's mobile ad network, or a consortium of which they are the sole influential player.

Perhaps that explains why they haven't tried to heavily monetize this yet - that would pus more consumers into non-ad-based apps where Apple is strongest.

Re: Peter Thiel Sells Majority Of His Facebook Shares In Deal Planned Pre-IPO

#94

Post by bps4484 » Tue, Aug 21, 2012, 7:42 PM UTC

jfb wrote: post #61

bps4484 wrote: post #59

Earlier quoted context omitted.

Facebook would have to really screw up at this point in order to end up the next Yahoo! They made 1 billion in 2011, while yahoo only made over 1 billion 3 times (max was 1.8 billion in '05, my sources are the yahoo annual reports) since 96. The question isn't whether Facebook can be as big as Yahoo!, that is basically assured. The question is whether they can be the next google (who went from making 400 million when…

Absolute numbers are not a meaningful metric -- much better to compare e.g. each sites percentage of overall traffic, or dollar of revenue per user. There's so much more money being flushed down the internet toilet these days that I would be shocked if Facebook were anywhere near Yahoo!'s numbers from their peak.

I guess we haven't agreed upon what metric we are even trying to compare (not surprising then we have a disagreement). I was making a comment on facebook vs yahoo as a profitable business, so I looked at profit. Facebook may never get to yahoo in terms of $/user (I don't know what yahoo's numbers are like now, or at their peak) but what exactly are you trying to compare such that you think $/user is a worthwhile stat to look at?

You can make the argument that it's a different era now, so looking at total profit isn't an apples to apples comparison, but a counterargument could be that the internet is a much more competitive landscape than it was in, say, 1996 so that it's actually more impressive what facebook has done in this era.

Re: Peter Thiel Sells Majority Of His Facebook Shares In Deal Planned Pre-IPO

#95

Post by aeturnum » Tue, Aug 21, 2012, 10:17 PM UTC

alexro wrote: post #86

aeturnum wrote: post #69

Earlier quoted context omitted.

As I said in my post, I'd include forums in "social." Facebook has the graph, but you could construct a weaker form of that graph using any of the popular community-focused sites.

Not really. Facebook and other social sites nowadays all rely on one true personal identity. On forums on the other hand you can be whatever, multiple times, and have a discussion with yourself (even a meaningful one).

I have at least one friend with multiple Facebook accounts, which he has talk to each other as a joke. Much like Facebook, most of the significant interactions on forums happen between permanent, established accounts (4chan could be the exception that proves the rule, as everything on it is arbitrary and real projects are organized elsewhere).

Facebook wants to portray itself as a one-person-one-account service, but the lack of extra accounts is largely because they've obsoleted most of the reasons people would create multiple accounts.

Re: Peter Thiel Sells Majority Of His Facebook Shares In Deal Planned Pre-IPO

#96

Post by tatsuke95 » Wed, Aug 22, 2012, 12:35 AM UTC

qq66 wrote: post #43

tatsuke95 wrote: post #37

Earlier quoted context omitted.

He dumped his shares at half the IPO price. Say what you will about diversification, it doesn't represent much faith in the future growth of the company. You don't "diversify away" from a good investment. So, if you believe that Thiel is a savvy investor, then it's hard to be bullish in Facebook.

"You don't 'diversify away' from a good investment." -- that's exactly what you do. Given that there's nothing as a 100% sure good investment, you diversify away from investments that seem great to distribute your risk. Let's say Company X has a 10% chance of being worth nothing, and 90% chance of being worth five times what it is today. Is that a good investment? Of course. Would you want to bet a billion dollars on…

>"that's exactly what you do"

No, it isn't what I would do. You might re-balance your portfolio if your capital is limited, but you'd be crazy to sacrifice high expected returns for the sake of zero beta. Admittedly, my personal portfolio is much smaller than Peter's.

>"How much do you bet?"

If I were looking to profit from games? A lot. What I wouldn't do is go to a game with worse odds, that paid me for a roll of 6, for the sake of "diversifying", which is essentially what you're implying by saying Thiel sold his stake for this purpose. I would stick to the game with the best odds just like I would stick to the asset with the highest expected return.

I other words, if Mr. Thiel truly believed FB was a $100BB company, he'd be a fool to sell off his shares right now. I think this reveals that he doesn't really believe that. Neither do I, so I don't blame him.