September 18th, 2008
Facebook's Zuckerberg makes Forbes' rich list
Mark Zuckerberg, founder of the so-called social utility Facebook, has made number 321 of the Forbes 400, a list of the richest people in America, with a personal wealth of $1.5 billion.
Forbes’ calculation is based on an estimate that Facebook generates annual sales of $300 million, and the fact that Microsoft invested $240 million last October for a 1.6% stake, valuing the site at a very generous $15 billion. Although Forbes does concede that “analysts—and even a few Facebook investors—suggest [the] company’s value is far lower”. That being the case, perhaps Zuckerberg isn’t worth $1.5 billion after all?
For example, when the Microsoft deal was announced last year, I noted that it valued Facebook at 25 x more than News Corp. paid for MySpace in mid 2005, or 9 x more than Google paid for YouTube in late 2006:
Perhaps the question of Facebook’s worth goes to heart of the longevity and future value of social networks in general. If users stick around and the online ad market continues to grow at the rates expected then all is good and well. Alternatively, as Microsoft’s Steve Ballmer ironically pointed out only days ago: ““I think these things [social networks] are going to have some legs, and yet there’s a faddishness, a faddish nature about anything that basically appeals to younger people.”
For whatever Zuckerberg’s worth, at 24 years of age he is the youngest person to be included in this year’s Forbes 400. That must count for something :-)
Steve O'Hear is a London-based consultant, educator, and journalist, focussing on the Internet and all aspects of digital technology. See his full profile and disclosure of his industry affiliations.
