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Tag: Digital Sky Technologies

  • Facebook Raises $500 Million At $50 Billion Valuation

    It’s a happy new year indeed for Mark Zuckerberg and everyone with financial ties to Facebook.  Goldman Sachs and Digital Sky Technologies have invested $500 million in the company, according to a new report, and in doing so, valued it at $50 billion.

    A couple points of reference: it was only 38 months ago that Microsoft drew laughter by paying $240 million for a 1.2 percent stake in Facebook, valuing it at $15 billion.  And Yahoo and eBay just have market caps of about $21.7 billion and $36.3 billion, respectively.

    This counts as a very significant milestone for Facebook, then.  Andrew Ross Sorkin and Evelyn M. Rusli, who first reported the development, noted, "The new money will give Facebook more firepower to steal away valuable employees, develop new products and possibly pursue acquisitions – all without being a publicly traded company."

    Then here’s one other interesting detail: "As part of the deal, Goldman is expected to raise as much as $1.5 billion from investors for Facebook at the $50 billion valuation, people involved in the discussions said, speaking on the condition of anonymity because the transaction was not supposed to be made public until the fund-raising had been completed."

    Anyway, although all this should ensure Facebook won’t run out of money anytime soon, it means Goldman Sachs is liable to handle Facebook’s IPO whenever the company goes public.

    The hubbub, along with the plan to raise $1.5 billion more, may also mean the SEC’s rumored investigation into the trading of Facebook’s private market shares will become a little more serious.

  • Report Indicates DST Won’t Lead Twitter Funding Round

    Digital Sky Technologies, the Russian investment firm that’s pretty well poured money into Facebook (and also funded Groupon and Zynga), apparently won’t be providing Twitter with any cash in the near future.  A report’s indicated that Kleiner Perkins will instead be the organization leading a new round of funding.

    "[S]ources close to the situation" provided Kara Swisher with this information this afternoon, and it makes a certain amount of sense.  Kleiner Perkins’s history is something any company would be glad to be part of, and where DST is concerned, people at Twitter might have been concerned about conflicts of interest with its other social media investments.

    Anyway, as for some additional info Swisher was able to gather, she wrote, "The valuation for the new round – which sources said is well above $150 million – will be from $3.5 billion to $4 billion."

    Twitter LogoThat’s rather impressive.  Of course, some people will point to the $6 billion Google supposedly offered Groupon and argue that Twitter should be worth more.  Also, others may complain that Twitter isn’t generating enough revenue to forego the round of funding.

    Still, about 15 months ago, Twitter was judged to be worth $1 billion, so a valuation of $3.5 billion or $4.0 billion will represent an impressive increase.

  • Major Facebook Backer Hints At Further Investments

    Digital Sky Technologies, the Russian investment firm that’s poured hundreds of millions of dollars into Facebook, is preparing to go on the hunt again.  Its founding partner and CEO, Yuri Milner, talked this weekend about making additional investments, and also said a little about Facebook’s worth.

    Let’s address the matters chronologically and look at Milner’s comments regarding Facebook first.  He told Rupert Neate, "Many people thought Facebook at a $10bn valuation at the bottom of the market was expensive.  But our thesis is to find the best companies in their categories and invest in them.  The better companies that we look at tend to be expensive."

    Milner later added, "My vision is that Facebook will change a lot of things about the world, particularly e-commerce payments."  Which is a nice hint about what Facebook might focus on after its current crop of privacy problems is put to rest.

    As for what’s next on DST’s menu, Milner wouldn’t get very specific.  But he did emphasize that he’s interested in disruptive technologies, and according to Neate, made a point of stating that his organization hasn’t decided to pass over Twitter.

    DST will definitely bear watching in the weeks and months ahead, then, considering the amount of money it’s prone to throw around.

  • Facebook Investor To Put $1B Into Social Media

    The Russian investment firm that’s contributed hundreds of millions of dollars to Facebook’s bank accounts is not even close to ending its involvement with social media.  According to Yuri Milner, who’s the CEO and founding partner of Digital Sky Technologies, his organization is interested in doling out another $1 billion.

    Obviously, that’s a stunning amount, and perhaps all the more so since Facebook, which is one of the most successful social media sites in existence, doesn’t yet seem to be making money hand over fist.

    There’s an aspect of DST’s investment strategy that’s arguably even more interesting, however, as it looks like all – or even most – of the $1 billion isn’t headed for Facebook.  Milner told Olga Kharif, "We monitor close to 50 companies globally that can be potential investment opportunities."

    So a significant Facebook backer must think it’s possible for all sorts of other businesses built around social media to turn a profit.  Despite the facts that Twitter’s had so much trouble landing on a revenue model and MySpace may be unable to extend its profitable search deal with Google.

    It should be interesting to see how DST proceeds.  Kharif reported that at least one investment should be announced by the middle of this year.