5 ms·

I agree, but as an aside, is it possible Netscape merited that valuation? Was Netscape's a squandered opportunity, or the most likely outcome. I mean this in t

by ericb 16y ago

I agree, but as an aside, is it possible Netscape merited that valuation? Was Netscape's a squandered opportunity, or the most likely outcome. I mean this in the sense of odds--was the valuation wrong because the odds of success were really so slim, or are we calling the die roll of a hard six inevitable after the fact? I bring this up because I had a similar feeling to what you describe about Google around its second stock offering, but it has done extraordinarily well since then. I second guess these judgments because in hindsight everything seems inevitable.

jacquesm 16y ago
Google at least has a business model, I can't say I can actually detect one in the case of facebook. As for netscape, yes, in part it was a lost (or destroyed, more likely) opportunity, but at the same time even if they had continued to be successful their valuation at the time was right up there with far future science fiction.
- jbeda 16y ago
  Honestly, you have to be blind not to see the business model and assets that they are building. Go to http://www.facebook.com/ads http://www.facebook.com/ads and take a look. You can target ads at "all doctors under 30 in the chicago area that went to a ivy league school". This type of targeting can lead to huge CPMs. One example of where they could go: they are one cookie away from a significant branding ad platform. Another idea: advertise on keywords in activity streams. Tie this to the branding ad network above. Update: Not clear why this is getting downvoted. These are two huge opportunities for Facebook that could easily justify big multiples. And people said the same thing about Google (no serious business model) before it went public.
- pclark 16y ago
  How can you "not detect" a business model for a company that has revenues of over a billion dollars? seriously?
  - jacquesm 16y ago
    Yes, seriously. I can't make soup of it. What's their intention long term, everything seems to be in anticipation of what they're really going to do. In all the time that I used facebook (haven't used it in months) I had a very hard time figuring out how they were making money on or off me. It can't be the ads I never clicked and it wasn't the subscription fee I never paid.
    - pclark 16y ago
      I believe Facebook has at least 6 business models in operation today, including: * ads in margin * special paid for groups * sponsored likes (these are discussed in Kirkpatricks book of Facebook - and here: http://www.quora.com/Facebook-1/What-is-the-revenue-distribution-of-Facebook?q=facebook+revenue http://www.quora.com/Facebook-1/What-is-the-revenue-distribu...) Additionally, Facebook has just launched Facebook Credits. Zynga (revenues $600M+) is their launch partner. Facebook gets 30% of their spend. I do not think they are struggling to monetize.
      - jacquesm 16y ago
        I always figured they'd go and do a payment system because in facebook the 'graph' of your friends validates you to the point that doing business with someone becomes a lot less risky than on paypal, but for some reason they seem to be holding back on that. Maybe the zynga deal is a prelude to that. It would make good sense to do that, facebook is the closest we've got to a verified ID on the net. The issues to contend with would then of course be hacked accounts and such but that's not different from other payment systems.

by ericb 16y ago

jacquesm 16y ago

Google at least has a business model, I can't say I can actually detect one in the case of facebook. As for netscape, yes, in part it was a lost (or destroyed, more likely) opportunity, but at the same time even if they had continued to be successful their valuation at the time was right up there with far future science fiction.

jbeda 16y ago
Honestly, you have to be blind not to see the business model and assets that they are building. Go to http://www.facebook.com/ads http://www.facebook.com/ads and take a look. You can target ads at "all doctors under 30 in the chicago area that went to a ivy league school". This type of targeting can lead to huge CPMs. One example of where they could go: they are one cookie away from a significant branding ad platform. Another idea: advertise on keywords in activity streams. Tie this to the branding ad network above. Update: Not clear why this is getting downvoted. These are two huge opportunities for Facebook that could easily justify big multiples. And people said the same thing about Google (no serious business model) before it went public.
pclark 16y ago
How can you "not detect" a business model for a company that has revenues of over a billion dollars? seriously?
- jacquesm 16y ago
  Yes, seriously. I can't make soup of it. What's their intention long term, everything seems to be in anticipation of what they're really going to do. In all the time that I used facebook (haven't used it in months) I had a very hard time figuring out how they were making money on or off me. It can't be the ads I never clicked and it wasn't the subscription fee I never paid.
  - pclark 16y ago
    I believe Facebook has at least 6 business models in operation today, including: * ads in margin * special paid for groups * sponsored likes (these are discussed in Kirkpatricks book of Facebook - and here: http://www.quora.com/Facebook-1/What-is-the-revenue-distribution-of-Facebook?q=facebook+revenue http://www.quora.com/Facebook-1/What-is-the-revenue-distribu...) Additionally, Facebook has just launched Facebook Credits. Zynga (revenues $600M+) is their launch partner. Facebook gets 30% of their spend. I do not think they are struggling to monetize.
    - jacquesm 16y ago
      I always figured they'd go and do a payment system because in facebook the 'graph' of your friends validates you to the point that doing business with someone becomes a lot less risky than on paypal, but for some reason they seem to be holding back on that. Maybe the zynga deal is a prelude to that. It would make good sense to do that, facebook is the closest we've got to a verified ID on the net. The issues to contend with would then of course be hacked accounts and such but that's not different from other payment systems.