$240 million doesn’t get you what it used to

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Microsoft won the battle royale with Google and Yahoo to invest in Facebook. So what exactly does $240 million get you? 1.6%. Couldn’t even round up to 2%. What that means is the rumors floating around of a $15 billion valuation are confirmed. $15 billion in 3 years… not too shabby, Mr. Zuckerberg. I knew I liked this guy when he had David Choe come in to paint at Facebook’s offices. Zuckerberg stake in Facebook is 20%, now valued at roughly $3 billion.

In a continued trend of fuzzy logic that essentially led to the dotcom bubble burst in the late 90’s, Facebook is on pace to bring in about $150 million in revenue this year. Even though this is an astounding figure 3 years in, the valuation is a figure that has drastically ballooned from about $2 billion last year to the current $15 billion… all based on speculation.

The big winners in this deal:

  • Microsoft, which basically took a dump on Google and Yahoo’s doorsteps. Let’s see how this pans out for them in the long run… with these big players it’s not a race, it’s a marathon.  Check out a Google and Yahoo spokeperson at a joint press conference to discuss how the two internet giants feel about losing to Microsoft in the Facebook deal HERE
  • Zuckerberg, who dropped out of Harvard and last year turned down a deal worth $1 billion with Yahoo.  He is now worth 3 times that much.  He has officially cemented himself in an elite class of rich nerds.
  • Accel Partners, the vc firm that invested $12.7 million in May 2005 and owns 11% of Facebook, which is now worth $1.65 billion.  My math is a bit rusty and I am almost 4 years out of college, but if my calculations are correct than Accel’s ROI on this deal is… 12,892% !!!   Yo, Yikes, Bingo!
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