SAN FRANCISCO - NOVEMBER 15: Facebook founder and CEO Mark Zuckerberg speaks during a special event announcing a new Facebook email messaging system at the St. Regis Hotel on November 15, 2010 in San Francisco, California. Facebook will launch a new messaging system aimed at enhancing it's social media product to its 500 million users. (Photo by Justin Sullivan/Getty Images)
Facebook could easily be valued at $100 billion at an initial public offering next year, analysts and experts said Friday.
Facebook shares on the private market have valued the social network around $84 billion, but that number could easily rise by next year, the Wall Street Journal reported. A handful of analysts and others seemed to believe that valuation could rise even higher -- while others, such as Bloomberg Businessweek, say social media may be fueling the tech bubble.
Geoff Yang, Venture Capitalist at Redpoint Ventures: "I put a P/E ratio of 25 [price to earnings ratio, which measures a company's share price against its earnings per share] and I get just under $140 billion in market cap in 2015. "
Rick Marini, chief executive of BranchOut Inc, a San Francisco startup: "Does [Facebook] deserve a higher than the average valuation? Absolutely yes. . . . They deserve a huge premium because it is like no other company existing today or like any other service in the history of the Internet.""
Kenny Bott, retired financial adviser, who bought shares in GSV Capital Corp.: "As I started talking to my friends, they sat there and they said, 'If I can only own Facebook pre-IPO, it would be off the charts.' "
Lou Kerner, managing director of the Private Shares Group at Wedbush Securities: "We think Facebook will be worth $234 billion in 2015. I think our estimates are quite conservative."
David Peterschmidt, founding chief executive of Inktomi, a dot-com era search engine: "This is a platform that has gained tremendous human participation. Now, how well they capitalize that and turn that into cash generation and profitability remains to be seen."
Christopher Soghoian, a privacy advocate: "People do not like Facebook. They don't trust Facebook. They're using them because they have to. . . . The moment someone else comes along with a product that is equally compelling, I think they're going to be in trouble."
At Press:Here, we are aware of the tech bubble that seems to be filling with air almost daily. How else can you explain Zynga, which makes really kind of crappy, knock-off social games for Facebook and MySpace, being valued at $1 billion? Or anyone suggesting with a straight face that daily deals site Groupon -- which has never made a profit -- should be worth $30 billion? Yes, social media is fun, but the bad part is that it spends innovation and money to get people to click ads rather than making our lives better or developing more useful technology. That may be the real reason Facebook or Zynga isn't worth billions of dollars.