userbase
My mum is hardly a self-obsessed Web 2.0 type.
Facebook's Russian sugar daddy has offered to buy back employee shares for $14.77 a pop, which means the ostensible value of the social networking site has dropped another $3.5bn. In late May, Digital Sky Technologies paid $200m for a 1.96 per cent share of the Palo Alto-based startup. That put the company's value at $10bn, …
Er, hasn't anyone remembered the original dotcom crash ? Y'know, the one where companies that were making huge losses, no traditional capital, and with no apparent way to make a profit, were being valued for ludicrous prices, only for the real world to kick 'em in the nuts ?
If facebook aren't making a profit out of 300 million members, how many people do they need to join to turn a profit ? I can imagine the chat down the local bank:
You: "Hello Mr/Mrs/Miss. Bank Manager. Can you lend me X Billion pounds/dollars/Euros to setup a new website. It'll be really cool."
Bank Manager: "And how long before you make a profit ?"
You: "Oh, we'll only need just shy of half a billion people to use our website to break even"
Bank Manager: "Looks like a sounds business plan to me. Here's the money"
Yeah, right..
The second time I read that article the more needlessly scathing it seems. Of course facebook isn't a 15, 10 or even 5 billion company, but it's still captured a vast base of users who're quite happy to flesh out the most tiny detail about themselves. It remains a direct marketeers wet fking dream and that information retains value whether you're a bitter old prat or someone who actually uses the service.