What’s the value of a social network?

06/24/08 :: by moquito

Everyday, we get approached by a new party that wants to develop a social network. Mainly, this is driven by the (somewhat insane) valuations that have been placed on big names, such as Facebook’s recent $15B valuation (that’s B for Billion).

TechCrunch did an interesting analysis today (below) of social networks and their valuation. It clearly shows a huge discrepancy depending on how various social networks were valued. For example, Myspace, the #1 in the US and #2 worldwide (after Facebook passed them in May) is worth anywhere between $3B and $19B.

Social Network Comparison

So what does all this mean? It means that this industry is still very new and still trying to figure itself out. It also means that whatever the exact calculation, social networks that gain traction have a tremendous potential and value!

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