Should Facebook have taken the $1.5B from Yahoo! Maybe! There is an interesting article in the Canadian Globe and Mail - which essentially poses the question why didn’t they take the money?
Most pundits are saying they should have and that they won’t get another offer - but not so fast - lets take a look at the numbers!

The following data is from Comscore Media Metrix (www.comscore.com).

Clink the links to open the file -

Facebook Summary

Quick Summary -

Facebook is a big property which has had a “patchy” growth story [23M unique visitors last month] . For supernova growth (ie Google/Myspace etc) – you need a true “network effect” – ie unconstrained vertical growth. My company has developed a modeling approach to Internet traffic that is aimed at the earlier identification of web sites with “supernova” characteristics. This involves sifting through a lot of data - but the evidence is clear that big sites got big very fast - (kind of obvious since the medium is so young)! What this does mean is that other candidates should have a similar growth profile and held to the same growth test standards.

Headroom for Facebook is still large ie 175M Americans on line vs 23M unique visitors. During September they apparently adopted a more open user policy and this has caused significant growth. There are however some weird potholes (Feb 07 results) that need to be understood further.

By contrast, Bebo who now apparently Yahoo is rumoured to be looking at, has little growth and would simply plug a functional hole in Yahoo’s portfolio. Bebo cannot be described as “hot” right now. Bebo did start out in Europe – but Europe is a big place and the numbers are unimpressive in North America.

For Facebook it is an interesting time – the jury is still out – it needs to show sustainable growth because the site is currently 50% of the unique visitors of Youtube. (a benchmark for a big private sale). Ave growth is just over 100% over 15 months – not enough to put it in the supernova category – however the turnaround in September may show sustainable growth in which case they could be heading in the right direction. Maybe they will get more than $1.5B after all.

These comments are made based on solid research data and a belief that its all about the numbers - everybody has different opinions on what works and what is a great value proposition on line - Post a comment….