Facebook now valued at $50 billion

By on November 30, 2010, 4:28 PM
$40 million in Facebook shares were recently reshuffled in auctions on SecondMarket, leaving shares at $20.76 with 1.9 million shares traded. 2.5 billion shares were left outstanding (taking into account the 5-1 stock split earlier this year), placing Facebook's valuation at roughly $50 billion, according to All Facebook. This is the highest ever valuation for the private company, and frankly it's huge given that the social networking website is only six years old.

For the sake of comparison, the biggest business built on Facebook's platform, Zynga, was last reported to be valued at $5.51 billion. Two other new social network companies, Twitter and Groupon, were both recently looking for new funding at a mere $3 billion valuation each.

Given that Facebook has yet to go public, it's not fair to compare its valuation to the market caps for the biggest and most successful publicly traded technology companies. Still, we'll show you the numbers anyway: Yahoo ($21 billion), eBay ($39 billion), Amazon ($81 billion), Google ($186 billion), Microsoft ($217 billion) and Apple ($291 billion).

The $50 billion milestone, although unofficial because Facebook is private, still shows that many investors seem to have faith in the company's ambitions. Here's the letter reportedly sent out to SecondMarket auction participants:

To All Facebook Market Participants:

Thank you for your feedback and participation in last week’s Facebook auction. As we had hoped, there was robust seller and buyer participation — the auction fully cleared at a per share price of $20.76. In addition, there was overwhelmingly positive feedback on the auction process. As a result, we will be continuing to conduct these auctions for the foreseeable future. For this week, the process will remain reasonably similar, with slight tweaks to the timeline. The reserve price for this week will be $20.60, the same as last week.

If you own shares that you are eligible to sell and wish to participate as a seller, please complete the attached Seller Information Sheet and submit it to SecondMarket at fb@secondmarket.com by tonight, Monday, November 29th, at midnight EST.

If you would like to participate as a buyer, please complete the attached Buyer Information Sheet and submit it to SecondMarket at fb@secondmarket.com by Wednesday, December 1st at 12:00 PM EST.

Please see below for more detailed results on last week’s auction and for this week’s auction calendar:

11/22-11/26 Auction Results:

Total Number of Shares Offered for Sale: 1,896,265
Number of Shares Cleared in Auction: 1,896,265
Reserve Price: $20.60
Clearing Price: $20.76

11/29-12/3 Auction Timeline:
• Monday, November 29th at 10:00 AM EST – Auction process commences
• Monday, November 29th at 11:59 PM EST – Seller order forms due
• Tuesday, November 30th at 9:00 AM EST – Buyers informed of share quantity available
• Wednesday, December 1st at 12:00 PM EST – Buyer order forms due
• Wednesday, December 1st at 5:00 PM EST – Participants informed of auction results
• Wednesday, December 1st at 8:00 PM EST – Transaction documentation distributed to buyers and sellers
• Friday, December 3rd at 4:00 PM EST – Completed transaction documentation due from buyers and sellers
• Friday, December 3rd at 7:00 PM EST – Notice to be sent to Facebook, Inc.





User Comments: 12

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TomSEA TomSEA, TechSpot Chancellor, said:

I don't know whether to be impressed or throw up....

princeton princeton said:

$50 billion but they can't afford half decent servers. With all the money they have(I know the $50 billion isn't just cash) there's no reason why facebook goes down occasionally.

P.S. No I don't use it. But it causes the BRANDON! THE INTERTHINGY IS BROKED!!!

Leeky Leeky said:

But it causes the BRANDON! THE INTERTHINGY IS BROKED!!!

Funny that, the wife uses the much ruder equivalent when she can't get on her stupid-facebook-i'm a cook and farmer games with our 50mb internet connection.... She never listens to reason either!

DSP8000 DSP8000 said:

"Wow, there's some fine print for ya!" Pretty big numbers here. Facebook is double edged sword. There are so many people out there that have no idea how to use it. And then, privacy goes everywhere. I think their privacy still sucks big time. The fact that there are number of new Facebook scams popping out every day, will just make it a VERY big target...

Leeky Leeky said:

I'd sell right now if I owned it, it can't be much more and it'll be on a downer again!

DokkRokken said:

I remember when Rupert Murdoch valued MySpace at six billion, and analysts pegged it at about ten billion back in around 2006/07. I wonder what the valuation of that place is nowadays, if it even really exists anymore.

In a couple years, we're going to be searching for this TechSpot article when Zuckerman and his investors are busy trying to unload FB onto its newer, and better competitor in the hopes of making something, anything, to recoup their losses. :P

Benny26 Benny26, TechSpot Paladin, said:

Thats just down right disgusting...It doesn't even work properly. Everytime they apply a "fix" to it, they make it worse (?)...I wish i understood the world sometimes. I wish i understood things like facebooks wealth, things like how a person can pay millions for a sheet of paper...Or the art world as it's known

But then i suppose kudos to Zucabag (or what ever the hell his name is)...Beating Bill gates in the fortune for age catagory must feel nice...

Guest said:

Anyone who wonders why the US (and world) economy is so screwed up - this is it!

A company that doesn't actually produce or sell a product or add anything of real value to the world except a way to waste time can be valued like this? What a travesty and a shame. No wonder Obama got elected. People are friggin' morons.

Cota Cota said:

wow 50 billions on people wasting time in nonsense talk?, they should pay you for using that crap lol

63Jax said:

...50000000000 for what? jessus...i wouldn't give 5 bucks for that piece of shit! only in USA is possible to do bunch of money without doing absolutely nothing, just like Oprah, she makes money for talking with people...

Guest said:

While I agree with most of your post the last part if totally wrong.

do you know what oprah owns? you know how long she has been running that show.

Or that she even owns the production company.

As much as I hate talkshows don't be dissing oprah bro she went from nothing to one of the riches women in the world and gets my respect and doesn't deserve your jealously. Why don't you actually read up about her and you will see she has done more for the world than this Facebook clown.

Guest said:

He should sell for $30 Billion it while he is still ahead, move to Montana and live on a 100 acre ranch.

But, he wont, instead, he will lose it all as the facebook value drops down in to the toilet. And that will be his biggest mistake he will ever make in his life.

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