money in the bank counts. not valuation.
Goldman Sachs invests in Facebook at $50 Billion valuation
101–110 of 130 posts
Re: Goldman Sachs invests in Facebook at $50 Billion valuation
#102Earlier quoted context omitted.
Are you suggesting that people buy Wal-Mart and Microsoft stock not because they expect to make money, but because Wal-Mart and Microsoft use their power to induce them to do so? Perhaps Microsoft will make your PC crash if you don't own enough of their stock? I am skeptical of your theory.
I'm suggesting GS would buy FB stock even if FB was loosing billions every year and there was no hope for future profits. In the same way GS and company are spending who knows how much on political campaigns and lobbing.
Can you unpack this a bit more? I'm still not sure who you're claiming has power in this situation, and why that makes GS want to buy FB stock.
Re: Goldman Sachs invests in Facebook at $50 Billion valuation
#103At this valuation, I want to put money into SecondMarket stock, not Facebook. Facebook is a great company, with tremendous prospects. Its growth curve is going to slow significantly, however.
The SEC may catch up with SecondMarket and plug the leak at any time and possibly quite soon.
What's the leak? They are a holding company and a member of FINRA. I'm genuinely interested in how you think the SEC might shut them down.
Besides, SecondMarket is growing fast in Europe and Asia too.. They trade stocks all over the world now, so it's not just one 'leak' that the SEC can plug.
Re: Goldman Sachs invests in Facebook at $50 Billion valuation
#104clear sign of an ipo. also why are they raising more capital?
Re: Goldman Sachs invests in Facebook at $50 Billion valuation
#105Can someone explain how fb is worth 50B? I.e. how much revenue are they making/projected to make, and how was this number arrived at?
I don't think Goldman's position is really revenue based. It looks more like they are pretty much trading on the value of the company shares. I think this is really a way for them to get in on what they believe will be a pretty large IPO, and a way to make money trading on Facebook shares by getting in sooner rather then later. At some time Facebook's revenues will become relevant but you can likely make some serious money having a position in Facebook before it reaches that point.
Re: Goldman Sachs invests in Facebook at $50 Billion valuation
#106Earlier quoted context omitted.
I'm suggesting GS would buy FB stock even if FB was loosing billions every year and there was no hope for future profits. In the same way GS and company are spending who knows how much on political campaigns and lobbing.
Can you unpack this a bit more? I'm still not sure who you're claiming has power in this situation, and why that makes GS want to buy FB stock.
GS wants to handle the IPO.
Re: Goldman Sachs invests in Facebook at $50 Billion valuation
#107Is that reasonable? Suppose that Facebook eventually needs to settle at a P/E of 10:1. Then it needs $5B/year of profits. If Facebook is like Microsoft in that it can maintain a high profit margin due to continuing to successfully exclude any competitors from its market, just as it has so far (in Microsoft's case, through a combination of government-granted monopolies, criminality, and consistently not fucking up; in…
Why in the world are you talking about Facebook blackmailing users to earn $2/$3 per user? Advertising (and maintaining what's left of their reputation) is clearly fall more lucrative. If each user just clicks on one Facebook ad each year, that's $2/user/year right there.
Let me know when Facebook has $2 CPCs across the board and I'll agree with this statement
Re: Goldman Sachs invests in Facebook at $50 Billion valuation
#108Apples to Oranges comparison: Porsche -> Mkt cap 11.72B Volkswagen-> Mkt cap 54.59B
Yet Porsche owned/owns 75% of VW. Do your research.
Re: Goldman Sachs invests in Facebook at $50 Billion valuation
#109Earlier quoted context omitted.
More than that- this type of deal could potentially greatly harm current Facebook equity holders, or much more likely potential buyers of the IPO. If Goldman Sachs is both an investor and the bank that eventually takes them public this deal is rife with conflicts of interest. Ex: In order to invest at this "low" valuation Goldman had to promise to set the initial price of the IPO to be artificially high. People buy t…
Shouldn't the bank that does the IPO try to set the price as high as will sell anyway?
Not at all- it's similar to the Real Estate Agent problem that is described in detail in Freakonomics. The bank has some slightly higher interest in raising the price and getting more money- but a much higher interest in offloading as much security as possible. This has led to problems like banks selling to specific IPO turnaround firms that can grab huge share volume early on, sending the IPO up in value before selling out right near close of trading, sometimes trashing hot IPOs on day 1.
You can read about this: http://antisocialmedia.net/ipo-probe-of-wall-street-ties-ton...
Re: Goldman Sachs invests in Facebook at $50 Billion valuation
#110Interesting. 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% is still probably a generous estimate -- given Facebook's 3000 or so employees and the fact that all not-very-senior employees should add up to 2%. Also, stock options need to have a hardly-discounted exercise price attached. That is, an employee that gets a stock option package reflecting shares worth $500K will have to shell out (at least) $450K to exercise them when the time comes. So based on this valuatio…
My understanding is that all new hire grants @ facebook are given in restricted stock units (RSU) not options, in part to avoid the 500 shareholder rule.