But also the fascinating background at LAT, "Facebook's Cash Infusion Whets Appetite of Investors: The $500-million Investment from Goldman Sachs and Digital Sky Technologies Heightens Pressure on the Social Network to Go Public. But Facebook Executives Are in No Hurry":
What's driving the Facebook derby? The massive yet unproven moneymaking potential of the world's most popular social networking site, which boasts more than 500 million users. The company has raised nearly $1 billion without tapping the public markets, creating pent-up investor demand for the next big Internet IPO. The anticipation is similar to the frenzy surrounding the 2004 initial public offering of Google, the world's most popular search engine. Google raised $25 million before going public.RTWT.
"There's this expectation that just like Google went through the roof, Facebook will too," UC Berkeley law professor Robert Bartlett said.
Facebook is the undisputed — and seemingly invincible — leader in social networking, the latest trend to grab eyeballs and dollars on the Web. Seven years ago, Facebook founder Mark Zuckerberg came up with a new way for college students to connect, sparking an online revolution in the process. Now the billionaire digital age mogul talks boldly of doubling Facebook's users to 1 billion. There are no guarantees that Facebook won't stumble like News Corp.'s MySpace before it, but the money continues to pour in.
Facebook's explosive popularity got a boost last year with the movie "The Social Network." At the time, Thiel tried to capture the exuberance in an interview with The Times.
"Great consumer companies grow fast, and this is definitely one of the greatest consumer companies in all of history," he said. "It is culturally really important, and it represents a permanent shift, sort of like television or radio if they were invented by a few people in one company. That it's a consumer-facing company makes it very interesting to people. People can relate to it. People have ideas of what it should do different or better. It's somewhat of a unique thing. There's a lot of intensity surrounding it."
Facebook owes its status to its increasing ubiquity. It has become the place people go to find their friends, sort of like a modern-day phone book. While Facebook quickly has captured the attention — surpassing Google as the most visited website in 2010, according to Internet analytics firm Experian Hitwise — it has been slower to tap revenue streams such as advertising, payment systems and e-commerce. But some advertisers are bullish on its prospects.
"It's the real deal," Michael Lynton, chairman and chief executive of Sony Pictures Entertainment, said in an interview late last year.
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