Microsoft and Google Court Facebook

September 27th, 2007

Facebook could be likened to the prom queen of the social-networking community these days. Its suitors are Microsoft and Google, among others. Indeed, companies are standing in line, hoping for the chance to invest in the popular site.According to news reports, Microsoft and Google are both interested in snagging a stake in the company. The Wall Street Journal is reporting that Microsoft might be willing to invest $300 million to $500 million for a 5 percent slice of the Facebook pie. Meanwhile, the New York Times is reporting that Google is interested as well.

Facebook’s valuation is more than $10 billion, according to news reports. A bidding battle between Google and Microsoft could drive that valuation even higher. Here’s the mystery: Facebook’s actual revenues have been held close to the vest. Pali Research provides some insight, estimating that Facebook generates somewhere between $60 million and $96 million in annual revenue, though without a significant profit.

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