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Thats amazing, i need to setup a Facebook acc too..
Facebook Inc. said Tuesday it has raised $200 million from a Russian Internet firm in a deal that values the online social-networking service at roughly two-thirds the amount set when Microsoft Corp. came on board as an investor in late 2007.
Palo Alto, Calif.-based Facebook said Digital Sky Technologies will take a 1.96% ownership stake that values it at $10 billion. Microsoft's /quotes/nls/msft (MSFT 20.34, +0.59, +2.99%) $240 million investment in Facebook less than two years ago, for a 1.6% ownership stake, implied a valuation of $15 billion. See full story.
Facebook Chief Executive Mark Zuckerberg, in a conference call with reporters, cited external economic conditions for the difference in valuations, in addition to the more complete partnership implied in the Microsoft deal.
"We did the Microsoft investment ... at the absolute peak of the market," Zuckerberg said. "That was a year and a half ago, and the world was in a pretty different place at the time."
In addition, Zuckerberg said, Microsoft's investment "was just one piece" of a deal that also involved developing online advertising formats. "Relative to the economic conditions for when the Microsoft deal happened... we feel really good about the progress we've made," the CEO said.
Zuckerberg said Facebook is in no urgent need of the new money. He said the company expects 70% annual revenue growth, and to become "cash flow positive" in 2010.
Founded in 2005, Facebook is expected to pull in some $230 million in revenue this year, compared with an estimated $210 million last year, according to research firm eMarketer. As a private company, Facebook doesn't disclose financial results.
In addition to its current investment, Digital Sky has also agreed to acquire as much as $100 million worth of common shares from current and former Facebook employees looking to liquidate some of their holdings in the company.
Facebook has long been searching for a way to allow employees to cash in on their equity, in lieu of a sale of the company or an initial public offering of its stock -- both an unlikely prospect any time in the near future. Late last year, Facebook delayed a plan to allow employees to sell a limited number of shares, citing the economic environment. See story about Facebook's delayed employee share sale.
Digital Sky Chief Executive Yuri Milner said that the purchase of Facebook employee shares "will happen in the next few months," but offered no further details.
Digital Sky, with offices in Moscow and London, focuses on Internet investments in the Russian and Eastern European markets, and says it has poured more than $1 billion into over 30 companies since 2005.
Facebook said Digital Sky will not receive a seat on the company's board as part of the investment.
"I have my own business to run," Milner said.
According to media reports, Facebook has been shopping around for some time to raise additional funding. The soaring popularity of its social-networking service has resulted in more than 200 million users, boosting the costs of its infrastructure such as data centers.
Zuckerberg said the company doesn't have "any specific plans to talk about" in terms of putting its new round of funding to work.
Source : marketwatch.com
