Facebook valuation rumors swirling again

Everybody's playing the Facebook valuation game again, in light of persistent reports that the social network is in need of more cash to fuel its rapid and expensive global expansion.

The rumors aren't too surprising. Given the recession and the tough advertising climate, the numbers getting tossed around are some of the lowest we've seen recently.

Currently circulating: Facebook CEO Mark Zuckerberg rejected a fresh round of funding that would have valued the company at $4 billion. Another: one potential investor submitted a term sheet for a valuation in the neighborhood of $2 billion.

What we've heard: Facebook stock trades privately at between a $2 billion and $3 billion valuation. That's consistent with the numbers that everybody else is tossing around. And we've known for a while that when the ConnectU vs. Facebook legal spat was settled, Facebook valued itself around $3.7 billion.

What's new this time around is that reports indicate Zuckerberg is extremely adamant about rejecting investment cash at a valuation he considers too low. When Facebook took a $240 million stake from Microsoft in November 2007, the investment was at a $15 billion valuation. Since then, it's become clear that it was a preferred-stock deal and that Facebook's true valuation has never been that high. But from what it sounds like, Zuckerberg would like it to get up there.

It was long before the massive Microsoft stake, after all, that Yahoo offered to buy the social network for $1 billion. Considering how much Facebook has grown since then--not to mention the new investments--the valuation shouldn't be only two or three times that.

"As a matter of policy, we don't comment on financial matters such as company valuation," a Facebook representative told CNET News in an e-mail.

This post was updated at 8:41 a.m. PT.

[mikehill33]

Facebook's valuation is in the process of drying up just like the traffic on Facebook after this god-awful redesign.

Zuck is sitting too long, and will miss the boat. Sure he might get bought, but all the lower-level serfs will get screwed as usual.

[dcase99]

Value? What value?

[jeffyablon]

You're kidding, right?

Reminds me of the Southpark episode where everyone wanted their hundres of millions of dollars in "Internet Money"

Sure, the concept you put out there makes sense: "only two or three times the valuation seems low" is right. But this isn't a real business yet, and ANY valuation is pure speculation.

It's worth what it's worth. Like your house was "worth" $500,000 a year ago, but now it's "only" worth $325,000. Oh, and by the way... you can't actually get anyone to pay you THAT much, either.

C'mon . . .

Jeff Yablon
President and CEO,
PC-VIP/Virtual VIP
http://answerguy.com, http://pc-vip.com

[Mike+1]

Facebook has less value every day to me and most of my friends that once used the service. Some have started using Linked-In as an alternative for business contacts, but most quit using this type service and resorted to e-mails and old-fashioned phone calls. Most of them have even less use for twitter.

[flickrz]

facebook is another youtube i.e. big money black hole. Spending > Revenue.

[mirrordash]

Facebook has negative value for me. I'm forced to have an account because everyone else uses it and people post events there that I can't respond to unless I'm registered (I really miss evite). Facebook is the most annoying site on the Internet. I really wish it would go away.

[norcomspe]

I joined face book to communicate with family and friends living aboard. In the beginning, it was great! My family and friends excitedly add me to their friends list. Nevertheless, I soon learnt facebook could also be an enabler in bringing division to family and friends. The writings on Facebook's so called ?WALL? sometimes reveal personal issues that need to stay between a perticular family member, or a friend. It also allows people to use the social tool as an excuse NOT to pickup the phone to talk to family or friends. The social get togethers are also up in the air, which is a bad thing. As a society, we need to spend more time with each other in the physical form and not virtual form.

[11Art]

I like Facebook. I liked it better with the previous interface though. By a lot. As did my friends.

See, Facebook screwed the pooch.

You've Eurotrash signing up now. That's the kiss of death.

THE best move FB could make would be to restore the previous UI. That'd make it as it was: fun and fast-paced. This re-do is a ******' dog . . ..

[Drummer16161616]

The fad of social networking is on the way out. It's a commitment for many people that they wish not to have, and people are starting to realize that they can't keep it up forever. Mass texts do a much better job at getting people together rather than a very asynchronous form of communication i.e. social networks. Plus, *** did they do to their UI?