Archive for May 27th, 2009

Facebook avoid the IPO and steam ahead with expansion plans. It is not your average valuation we are talking about – $10B is quite a accomplishment. Please find earlier Facebook articles here; Facebook turned down funding at $8B, Few IPO candidates, Rapid growth and several more here.

Here is a story from Read Write Web.

“After we saw some rumors about this over the weekend, Facebook today confirmed that it will receive a $200 million investment from Digital Sky Technologies (DST), one of the leading Internet investment groups in Eastern Europe. This investment puts Facebook’s valuation at $10 billion. DST also plans to offer to purchase at least $100 million in Facebook common stock from existing shareholders.

According to Facebook‘s CEO, Mark Zuckerberg, roughly 70% of the company’s users are now outside of the U.S., so cooperating with an international investment firm seemed to make sense in order to bring a global perspective to Facebook’s operations. DST will not get a seat on Facebook’s board, however.”

It continues…

“Digital Sky Technologies is a major player in Eastern Europe, and with Mail.ru, Forticom, and vKontakte among its assets, the company claims to account for over 70 percent of all all page views on the Russian-speaking Internet. Interestingly, DST (mostly through its investment in Forticom) also owns interests in a number of social networks like one.lt and Odnoklassniki.ru.

This deal also fits in well with other rumors about Facebook trying to raise capital to allow its employees to cash out some of their options. Just two weeks ago, our colleagues at VentureBeat reported that Facebook’s current investors “found it a stretch to supply the full amount of capital” that would be needed to provide Facebook with enough money to allow it to buy out roughly 15 million common shares at around $10 each.”

Zuckerberg commented this deal on the pressconference by saying…

“The company does not have any immediate plans for the cash it will receive from DST. Zuckerberg was also asked about a possible IPO, but according to Facebook’s CEO, an IPO is not on the “immediate horizon.”

Being asked about Microsoft’s investment in Facebook at a $15 billion valuation, Zuckerberg mostly sidestepped the issue, but stressed that this investment was part of a larger partnership at the top of the bubble and that he thinks that $10 billion valuation is “fair” and that he “feels good” about it.

Given the nature of the call, there was not a lot of focus on specific features, but Zuckerberg did confirm that Facebook is testing out a video chat feature. Our friends at All Facebook spotted references to this in Facebook’s code two weeks ago.”

Read the full article here.

Other sources for this topic include: TrolleyBlog, The Next Web, PEHub, Northloop,

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