Social Media and Social Networking

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Russian Firm Contemplates Facebook Investment

Posted by Vaibhav Kalamdani on May 25, 2009

facebook-investmentThe value of an Internet firm depends hugely on how popular it is with the online audience. Considering this fact, it is no doubt that several companies all over the world must be thinking of gaining at least some share of Facebook, which has a record 200-million-plus-users and is continuing to grow at a rapid pace. Digital Sky Technologies is one such company that has lately shown interest in investing $200 million in the social networking giant.

The Russian Internet player has offered to invest in a deal that would value Facebook at a mammoth $10 billion as per the latest reports by the Wall Street Journal. However, the details of the financial plans were not revealed by either of the companies.

Today, one of the biggest challenges for Facebook is to let the capital keep coming in and look out for revenues. The company has been on its toes to raise money through private equity or venture capital to realize its expansion plans. And the good news for Facebook is that it has already received several proposals, as per the Journal.

Digital Sky Technologies already owns a stake in Mail.ru, another Russian Website. With Facebook growing in popularity, the company proposed a $200 million investment in the social network’s preferred stock and another $100 million to $150 million in its common stock. The latter investment proposal would value Facebook at $6.5 billion, the report stated.

Earlier, Facebook had received funds from software-maker Microsoft in 2007, allowing it to capture 1.6 % stake in the company through a $240 million investment. This capital generation helped the company grow its business and attract millions of users worldwide. No wonder, Facebook is considered as one of the top photo-sharing sites with over 15 billion photos already available on it.

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