What Are You Worth to Facebook?

Oct 25, 2007

It was widely reported yesterday that Microsoft bought a 1.6% stake in Facebook for $240 million, thereby valuing the company at $15 billion. Sure getting in on such a huge cache of advertising-ready eyeballs and consumer data is worth a lot, but the bid puts a price of $357 on each of Facebook’s 42 million accounts. Marketplace’s coverage put that number at $300 dollars, which takes into account Facebook’s projection of 50 million accounts by the end of the year. Beyond that, however, is the fact that an account doesn’t necessarily mean a user; nothing stopped me from creating a Facebook page for the Pope and I know that Jesus isn’t actually my friend. Furthermore, not all registered users regularly use the site. I would bet that more than a quarter of my friends use facebook less than once a month, and even then only for a handful of page views (no, I don’t want to be your super-best-buddy). If we take my brash generalization at face value, leaving 30 million active users, they are each worth $500. Do you really think you see $500 worth of ads on Facebook?