Facebook Raises $1.5 Billion At $50 Billion Valuation

[The Straight Story]

Facebook Raises $1.5 Billion At $50 Billion Valuation

Facebook has officially announced that it has just raised $1.5 billion in funding at a $50 billion valuation, according to a release issued today (we’ve embedded the release below).

As stated in the release, the investment was broken into two parts. Goldman Sachs participated in the first round (via an offering to its non-U.S. clients in a fund), which totaled $1 billion. In December, DST and Goldman separately invested another $500 million into the social network. Both rounds gave Facebook a $50 billion valuation, says the company. This brings Facebook’s total funding to a staggering $2.336 billion.

It’s interesting to note that Facebook didn’t take the full $1.5 billion from Goldman Sachs in the first part of the investment. As stated in the release:

Under the transaction’s terms, Facebook had the option to accept between $375 million and $1.5 billion from the Goldman Sachs overseas offering, at the discretion of Facebook. While the offering was oversubscribed, Facebook made a business decision to limit the offering to $1 billion.

http://techcrunch.com/2011/01/21/facebook-raises-1-5-billion-at-50-billion-valuation/

[DJ13]

1. Why, did they need money?

Or is that a bonus slush fund for the Facebook executives?

[Yavin4]

2. No Way Facebook Could Raise That Kind of Capital Without Selling Your Personal Information

There's just no way anyone would give them that kind of money without hard revenue data. This is why this valuation is being done on the sly.