Comments on: Even Microsoft doesn’t value Facebook at $15 billion

By: Mathias

Mathias — Tue, 20 May 2008 15:26:06 +0000

Come on guys, this deal is a simple deal to understand. I don’t understand this nonsense about the deal being worth less than $15B. If you pay $240 Million for 1,6% then the company is worth $15B, that’s it. Terms or not.

Financial investors can’t see this strategic value, that is something I understand. But you need to understand that the deal between MS and FB is a strategic deal all over. Nothing else. It has nothing to do with Wall Street “talk” at all. This is called a “business” transaction. It has nothing to do with stock exchanges and when it will be anything to do with stock exchanges FB will be capitalising on the MS deal and the P/E ratio will have reached lower numbers (hopefully). MS would be able to trade the value on the stock exchange very soon (unless ad revenues from FB will be a total flop).

By: Eric Hates corps

Eric Hates corps — Mon, 05 Nov 2007 22:16:02 +0000

A great opportunity to stop using sites such as facebook, Micro$oft just wants to know about everyone’s preferences, since they already know what you listen to, now they’ll have a name “ yours” to sue if they don’t like the way you obtain your music, people stop using these type of sites!!, specially if they are owned by corporations.

By: David Mackey

David Mackey — Wed, 31 Oct 2007 03:10:47 +0000

1.6% for $240 million does seem a bit pricey…And I’d have to know more about the ad deal to know whether it really reduces the supposed valuation of Facebook.

By: Facebook ne vaut pas 15 milliards de $ | bbxdesign

Facebook ne vaut pas 15 milliards de $ | bbxdesign — Sun, 28 Oct 2007 10:35:58 +0000

[…] ce que souligne Ahmed Farooq dans son blog. En effet, l’accord publicitaire entre les deux groupes qui devait […]

By: Mong

Mong — Sat, 27 Oct 2007 20:14:39 +0000

I also wondered why those guys missed the ‘real’ deal but finally caught your blog from digg.

Its true 1.6% is so small that you cannot have even 1 chair in FB’s office with that share.

The real ‘deal’ is with the extension of accord.

By: Jamison

Jamison — Sat, 27 Oct 2007 12:44:30 +0000

I guess since MS saves time and money by following trends of other tech leaders, and since they charge an arm and a leg for their apps, they can afford to sink a few million into social networking, which is already heading downhill as it is.

By: Badguy

Badguy — Sat, 27 Oct 2007 00:12:30 +0000

What you guys all seem to not understand, is that this is nothing.
no big deal.
who cares?

If you think that it is sustainable, then you are clearly not thinking straight.
This type of stuff peters out rapidly once it reaches a climax.

Sure money well spent. If you are into sheep.

It is all hype, and the money generated will not last.

looks good on MS. good for facebook.

Good luck with your investment.

By: leo

leo — Sat, 27 Oct 2007 00:03:15 +0000

The good thing is that MS by doing that (and by overpaying a bit) sets the price for Faceboook so high that nobody will be willing or able to buy it. In other words it guarantees that Facebook will stay independent, and in good terms with MS (because of the ad deal and the fact that provided such a high valuation and cash). To me it was a brilliant move. Also note that Yahoo and Google were just outside the door but probabaly they wanted a bigger share of the company. MS prefers to see Facebook by itself rather than part of Google or Yahoo. - Leo

By: Ahmed

Ahmed — Fri, 26 Oct 2007 23:45:30 +0000

Faramarz - you are completely missing the point. Yes it got them 1.6%. But it got them MORE than that.

What you are basically doing is valuing the ad deal to be zero. And that is a giant mistake.

By: Faramarz

Faramarz — Fri, 26 Oct 2007 23:20:54 +0000

MS invested 240million for an ownership stake of 1.6%. They don’t give up that ownership at the end of the ad contract. That very simple fact sets facebook at a current valuation of $15billion. what is so difficult to understand?

the ad agreement can be a simple experiment or a deterrent for other companies to invest or it can be totally irrelevant. the only relevant fact is, regardless who takes over the agreement 2011 and further, MS will continue to be an owner at 1.6% stake.

This valuation will not change unless tomorrow someone comes and grabs a 1.59% stake at 240million of above.