Facebook CEO Mark Zuckerberg and his board met yesterday to discuss and eventually reject two funding offers for the company — one at a $4 billion and one at $2 billion, according to reports from VentureBeat and TechCrunch.
A source close to Facebook tells us the company values itself closer to $5 billion.
Ever since a report surfaced at BusinessWeek that Facebook intended to engage in vendor-financing for new equipment, there’s been speculation that the company is suddenly cash-strapped.
That’s not the case, sources tell VentureBeat, which reports Facebook still has $200 million in cash.
In addition, a source close to Facebook recently offered us these details on the company’s finances:
- Facebook’s revenue is growing 70% from where it was last year. (We believe last year’s revenue was about $365 million, so assuming some slowdown through the year, this would put 2009 revenue at $500 million-ish)
- The company has generated positive EBITDA (earnings before interest, taxes, depreciation, and amortization) since August of 2007.
- The company expects to start generating cash from operations (“Operationally cash-flow positive including cap-ex”) at some point during 2010.
VC Fred Wilson suggests we’re getting this sudden flood of information about Facebook’s finances because the company is preparing for an IPO.
Say what you will about Facebook, and a lot of people are trashing the company these days, it has 200mm users worldwide. It is building the social graph of the world. It is a very valuable and important asset. And apparently it is profitable.
It is also essentially a public company now. There is a market in their shares. The company’s basic financial information is available for our consumption and analysis. And we even are getting to see it’s financing play out publicly.
I suspect that Facebook is seriously considering doing what Google did and biting the bullet and going public. The IPO market is coming back (that’s my gut). And at this point, there isn’t much cost (other than financial costs of being public) that Facebook isn’t already paying.