By now you’ve probably heard that the big Softies are ponying up $240M for just 1.6% of Facebook. I’ll save you reaching for the calculator — that puts Facebook’s valuation in the $15 BILLION range.
Quite a few folks are saying how absurd this valuation is, and I agree.
However… it seems to me that one of the most likely buyers of Facebook would have been Google. Especially after Facebook rejected Yahoo’s paltry $1.6B buyout offer last year.
I don’t think even the MoneyG (as I like to call them) would spend $15B to buy Facebook. Doubly so given the lack of return on their YouTube investment.
Yet Facebook probably wouldn’t have sold for a price Microsoft were willing to pay. So instead, MS went strategic (and in my experience, that is something they can be masters at).
In my opinion, the net result of their investment is "if I can’t have you, neither can anyone else"… Microsoft have effectively locked up the allegedly hottest company on the planet for a mere $240M.
When you consider what Google et al have been paying for companies many have never heard of (even though they’re good), I think Microsoft look pretty darn smart…
P.s. I am way behind on my blog reading, so if smarter folks than me have already beaten this to death, I apologise…