On any given day we receive 5 to 50 stories to post on AllFacebook, however there’s no way for us to currently cover everything that goes on. Determining which stories to publish is part art and part science, however that doesn’t mean you shouldn’t be aware of all the things going on related to Facebook. That’s why we’ve decided to post occasional updates on the stories that we couldn’t get to the day before. Today we have 3 stories from yesterday that you should be aware of.
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That’s what you’d think if you read Sarah Lacy’s exposé on Facebook’s buyback program. Apparently it came as a surprise that an excessive number of employees wanted to sell their shares before an initial public offering inaccurately projected for later this year. So why would all these employees rush to sell shares when they could be worth much more at the time of an IPO?
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The New York Times has released initial details about the Facebook employee stock purchase plan from Digital Sky Technologies (DST). As I wrote back in May, DST invested $200 million and announced plans to purchase up to $100 million “from existing common stockholders that would facilitate liquidity for current and former employees’ vested shares in the company”.
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It’s time for this week’s round of the Facebook valuation game! Yesterday Henry Blodget reported that wealthy investors have been trading shares at around $5.50 which gives Facebook an approximate valuation of $2 billion. The only person crying about such a decrease is Microsoft, but then again Microsoft isn’t exactly short on cash. Owen Thomas at Valleywag states:
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It looks like the once much hyped Facebook stock sale has been called off. Owen Thomas of Valleywag was first to report the news following receipt of an internal email from Mark Zuckerberg in which he states that the company hasn’t been able to finalize a plan for the employee stock sale. Not good news for those Facebook employees who were looking to cash out just under $1 million of shares.
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FutureGame is a Facebook applications that lets you guess the price or direction of stock in the next 30 seconds. When I first heard the premise of this game I was a bit skeptical–how could guessing what the stock will do 30 seconds from now be fun?

Once I checked out the FutureGame app and it turned out to be highly addictive. There are a few different ways you can play FutureGame: guess the Euro vs. the US dollar, the Magic Index price direction, the US dollar vs. the Yen or the price of gold. Honestly though, no matter which way you play it, you still have the same odds of getting your guess right: fifty percent.
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As a privately held company, Facebook can avoid some of the woes that publicly traded companies are facing during this major economic downturn. and Facebook would like to keep things that way. In a recent ruling from the Securities & Exchange Commission (SEC), Facebook has been deemed exempt from having to disclose financial results publicly, reports BusinessWeek.

According to the Securities & Exchange Act of 1934, a privately held company is to disclose financial results publicly after reaching more than 500 stockholders and $10 million in assets. With Facebook hiring a slew of new employees in the past two years and often offering the new employees stock options, Facebook is getting dangerously close to the 500 stockholders mark. The pressure is on. Or is it?
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Image of Hundred Dollar Bills-' />We couldn’t help but play in the favorite Silicon Valley game of “Name Facebook’s Valuation!” Yesterday Henry Blodget posted that Facebook has officially begun to let employees sell shares at a valuation above $4 billion. He states that “the source recalled a strike price of $9.27 per share, versus a prior round of $8.90.” Regardless of what the valuation is, many employees at Facebook may have a great holiday season with much more cash in the bank.

Henry’s anonymous sources also claimed that revenue will be $265 million this year instead of $300 million. As Eric Eldon points out though, “Facebook’s fiscal year doesn’t close until the end of December, so that number is strangely specific given the present uncertainty about advertising spending and virtual gift revenue the company might bring in during the approaching holiday season.”

Ironically $265 million is exactly “how much eMarketer projected Facebook would make in U.S. advertising”, Eldon writes. We could sit and try to piece together how much Facebook is earning but regardless of exact revenue numbers, a more important sign of the company’s future growth is their sucess (or lack of success) in approaching Madison Avenue.

According to Jessica Vascellaro, “The company says 70 of the U.S.’s 100 largest advertisers have advertised on its site since 2007. But its share of total number of U.S. online display ad views was just 1.1%, according to market research firm comScore Inc., in its most recent report in June.” Compare that with Fox Interactive Media who has attracted “15.9% of display-ad spedning, according to comScore.”

Why does MySpace account for such a large percentage of display ads? That’s pretty easy! A quick look at the site’s design shows how the company is excessively ad heavy. The site is splattered with advertisements which arguably decreases the user experience. That doesn’t matter to MySpace though as they continue to experience solid revenue growth.

On site ads don’t represent the full potential though as the company may soon decide to expand their advertisements to other publishers. Whether or not the company decides to do so, they certainly have time remaining before they begin rolling out alternative monetization solutions. As Mark Zuckerberg tries to consistently emphasize, it is still early for the company.

Speculators aren’t so confident in Zuckerberg’s assertion but then again none of us are running the company, are we?

Image from American Shelf Life