Flashing the cash
Facebook is believed to have raised a hefty $500m from an investment by Goldman Sachs and a Russian investment firm, valuing the company at a staggering $50bn.
The NYT reported that the deal, leaked by a source ‘involved in the transaction' now means that Facebook is worth more than older internet powerhouses Yahoo and eBay.
Such a huge investment by one of Wall Street's most respected investors will no doubt further add to the social networks' clout and confirm its place as one of the big web hitters and a credible rival to Google.
The cash injection will no doubt help Facebook lure employees away from Google as well as develop new features and make acquisitions to expand its web reach...without being a publically traded company. It is believed the deal could also lead to some early Facebook employees being able to cash in some shares and make a fortune.
Facebook's deal comes just after the US' Securities and Exchange Commission has reportedly started scrutinising how giant private companies are operating. It will apparently probe web firms such as Facebook, Twitter and Zynga to check the companies aren't using their private status to dodge disclosure rules required of public companies.
The outcome of the inquiry or perhaps even this huge deal itself could pile on the pressure for Facebook to go public, even though its execs they have so far resisted the demands. Facebook's founder, Mark Zuckerberg has previously dismissed the prospect of an IPO, reportedly saying in November this year, "Don't hold your breath."
However, The NYT reported that sources involved in Facebook's fund raising said its board might consider an IPO in 2012.
Of course if that did happen it would be interesting to see how much the social networking giant is worth and although the company does not report its annual financial performance, it is thought Facebook is making money and a lot of it- perhaps $2bn in revenue every year according to some analysts.
