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Kara Swisher of BoomTown had some juicy details to reveal today about Facebook, apparently as blabbingly told to all by founder and CEO Mark Zuckerberg at an employee meeting in Palo Alto Theater. For the record, most of these details are the root of all that question-dodging, executive talk, and light awkwardness in his 60 minute piece and many of the recent keynotes discussions he’s been involved in. Eric Schonfeld of TechCrunch put all these details in a neat list, which I’ll very creditingly steal for Rev2 readers instead of creating my own (again, very creditingly):

  •  2007 Revenues: $150 million
  • 2008 Revenues: $300 to $350 million (projected)
  • 2007 Headcount: 450
  • 2008 Headcount: 1,000 (projected)
  • 2008 Capital Expenditures: $200 million (i.e., servers)
  • 2008 EBITDA (earnings before interest, taxes, depreciation and amortization): $50 million
  • 2008 Cash Flow (EBITDA – CapEx): negative 150 million.

The most interesting detail, of course, is the fact that Facebook will be running at a negative 150 million cashflow for 2008, despite Zuckerberg’s comments that “something we’ve tried to with Facebook ever since the early days is run at break-even.” Of course, as Swisher points out in her post, that is only because of the recent $300 million Microsoft investment that gives them the thin-air $15 billion valuation.

After playing with some of those figures in my head, I think we can safely expect an IPO around late 2009/early 2010. Call me naive, but if they’re able to run at a -$150 million cashflow and their Microsoft investment gives them $300 million (not to mention any forthcoming ones over the next year) — tell me that doesn’t make clear leeway for an IPO in two years!

Regardless of whether they’ll be running at a break-even or a negative cashflow, one thing is for sure: if Facebook is to IPO, with a $15 billion+ valuation, their current revenues aren’t going to cut it. Through Ads or Beacon, they’re yet to find that killer strategy to make them susceptible to be a successful — or at least profitable — company later on. And with a deadline of 2010, time’s running out.

Written by | dave

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13 Comments

  1. Danny Sullivan

    February 1, 2008 at 2:30 am

    Well, they might have to IPO this year:
    http://searchengineland.com/071026-140303.php

    If they have more than 500 shareholders (sounds like they easily will) and $10 million in assets (despite the losses, they’ll have these), they either go public this year or start reporting like a public company.

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  3. Sid Yadav

    February 1, 2008 at 5:14 am

    Great point — surely though Zuckerberg must have been aware of that when he made the statement on 60 minutes? That said, giving 500 out of 1000 employees stock options sounds very realistic, and additionally they have their executive stock holders — I have no clue how they’re going to manage through that.

  4. Floodster

    April 30, 2008 at 4:18 pm

    I’m pretty sure it’s 700 not 500. And since all Facebook employees have stock options, if they do hit their projected 1,000 employees then it’ll happen by the end of this year.

  5. Singapore Escorts

    January 22, 2009 at 9:12 pm

    Facebook like any major organisations wants to leverage on IPO for further expansion and growth.

  6. Property Sale

    January 23, 2009 at 12:08 am

    With the current downturn, i don't think IPO is on the agenda.

  7. Mike

    January 23, 2009 at 6:44 pm

    I think Mark Zuckerbergand his staff are a bunch of racist white folk, they are very nasty and rude to people of color , yes who post pics of themselves and family so you clearly know the race of people you are being rude too, i am strongly asking all people of color to delete their accounts. i will not stop until the site Facebook is down for good…..

  8. Web Design

    January 30, 2009 at 1:00 am

    It seems Face Book still wants to be independent. IPO market hasn't completely revived yet at this moment. Adding to this the recession and global depression in economy this would be tough. May be Microsoft is Face Book's new IPO.

  9. SEO

    February 1, 2009 at 8:48 pm

    Though facebook is trying to get help from IPO, in order to get rid of their critial circumstances and it seems to be very helpful but in long run, it may put them in to crisis..

  10. agathoszoe

    March 11, 2009 at 2:29 pm

    What experience or evidence do you have. Zuckerbergand is very young so I hope he isn't a racist. That's a strong accusation.

  11. agathoszoe

    March 11, 2009 at 5:29 pm

    What experience or evidence do you have. Zuckerbergand is very young so I hope he isn't a racist. That's a strong accusation.

  12. agathoszoe

    March 11, 2009 at 9:29 pm

    What experience or evidence do you have. Zuckerbergand is very young so I hope he isn't a racist. That's a strong accusation.

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