Hats off to Facebook

By May 17, 2012Facebook

Facebook is picking up a lot of criticism as it heads into its IPO. In particular there are questions over its continued growth and the effectiveness of its advertising formats, largely on the back of General Motors saying its Facebook ads haven’t been paying off. And to top that an increasing number of insiders are deciding to vote with their feet and cash in on the IPO.

I think all this criticism is a function of the valuation rather than a reflection of the quality of the company. As you may have seen Facebook just raised its IPO price and will be worth over $100bn if it goes out at the top of the range. Meanwhile the FT is warning that retail demand risks inflating the IPO.

I think that if I the valuation was considered to be low everyone would instead be focused on what a great business Zuckerberg and his team have built over the last eight years.

Venturebeat gave us a reminder what they have achieved this morning when they wrote that Facebook is breaking three records with its IPO:

  • Facebook will be the largest venture backed IPO of all time (c4x what Google did in 2004)
  • Facebook has raised $2.2bn in venture capital – more than any other VC backed company in the US and nearly 2x Clearwire, the second placed company (Twitter has raised $1.1bn)
  • Facebook has acquired 13 companies, more than any other company in the run up to its IPO. Twitter is second with 11.

Most companies would be happy reaching a value of $2.2bn, let alone raising that much money.

I say hats off to Facebook.

  • http://www.edocr.com/ Manoj Ranaweera

    Yeap! Its a remarkable story! Let’s hope Facebook IPO will create the next batch of entrepreneurs that will go onto create the next wave of amazing products and companies. Good thing with records are that they are there to be broken! Nothing remains the same!

    We are playing the long game at http://www.edocr.com – survival and growth leading to relevance and market/product fit! 

  • http://www.facebook.com/james.bluemink James Bluemink

    The power of transparency – who would have thought it

  • http://www.quickbuffet.co.uk/ QuickBuffet U.K

    I think the criticism then were not too far off. Recently a campaign I run on Facebook for quickbuffet.co.uk came in at £2.40 a like. Google looks a saint in the face of Facebook