
Inside Facebook
Inside Facebook |
- November 2010 Facebook Traffic: Usual Growth Worldwide, Slower in US, Measurement Firms Show
- With a Focus on Monetizing Mobile Apps, Tapjoy Leaves Its Scamville Past Behind
- Facebook and the Parallel Surge in (Early- and Late-Stage) Valuations
- Top 25 Facebook Games for January 2011
- What Goldman Sachs’ Reported $450 Million Investment in Facebook May Mean
- Announcing Inside Mobile Apps: Tracking the Convergence of Mobile Apps and Social Platforms
- Innovative Games Join Holiday Apps on This Week’s List of Fastest-Growing Facebook Apps by DAU
November 2010 Facebook Traffic: Usual Growth Worldwide, Slower in US, Measurement Firms Show Posted: 03 Jan 2011 02:00 PM PST More of Facebook’s growth appeared to be coming from abroad than in the US over the course of November, according to our latest review of reports from third-party web measurement firms. In fact, compared to the past few months, up through our last look, at October data, it’s basically flat in the US. Perhaps Facebook is starting to max out its market penetration in this country? Still, from the data available, that doesn’t appear to be the case around the world. Notes before we get started: The firms report data at varying points during and after each month, and they also use varying methodologies. We do our best to compare them, but considering the discrepancies, take each number with a grain of salt. Following a long slow rise, Facebook’s US traffic tapered off slightly from 133.5 million monthly unique visitors in October down to 132.7 million in November. That difference could just be due to the fact that the latter month is shorter — still, growth appears to be flat. The same story continues with the next firm, at least in the US. Facebook grew from 151.1 million in October to 151.7 in November, which is not much compared to past months. Worldwide, however, Facebook grew a healthy 14 million or so users over November, reaching 647.5 million by the end of the month. Worldwide, Google’s DoubleClick measurement service lists the same number it did a month ago — 590 million monthly uniques around the world. The daily active user count appears to have hit nearly 300 million by the beginning of December (but has fallen back slightly since then). In what appears to have been an unannounced recalculation, the firm is now showing Facebook 129 million monthly unique visitors. That’s the most it has ever tracked, according to the site today. But when we looked last month, Quantcast was showing Facebook had plateaued at 137 million monthly uniques. Apparently there was some sort of methodology change. ConclusionAll in all, Facebook’s November US traffic appears to be flat, while comScore — which provides the clearest month-to-month worldwide data — is showing monthly gains as normal. For reference, we separately track the data that Facebook self-reports in its advertising tool. We recorded it bringing in 145.3 million monthly active users, up 2.25 million from the previous month. Worldwide, we tracked Facebook gaining 22 million users over the course of the month to reach 573 million. (You can view a full set of demographic data, along with our analysis, in our Inside Facebook Gold report.) Another important point here is what’s happening with Twitter — most firms show it more or less flat in the US, but it continues to zoom up around the world. Each data source has typically showed a halting upward climb for Facebook, especially when one zooms in to look at the US or other specific countries. The more important thing is to watch for longer-term trends. And overall, that continues to be Facebook gaining more users. Stay tuned, as we’ll take a year-end look once December data is out. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
With a Focus on Monetizing Mobile Apps, Tapjoy Leaves Its Scamville Past Behind Posted: 03 Jan 2011 12:47 PM PST It’s hard to forget the shouting match that put an end to Offerpal’s heady days more than a year ago. The company, now known as Tapjoy, had become the prime target of Michael Arrington’s Scamville campaign for serving offers in Facebook games that signed up unwitting users for recurring charges.
But one more CEO, a name change and a year later, Tapjoy has turned the corner by diversifying onto mobile platforms and keeping its offers clean with brands like Gap and Netflix. It’s on track to have its highest total revenues ever on all platforms this quarter, says the company’s CEO Mihir Shah, who joined the company after Shukla stepped down. That’s on iOS, Android and Facebook. We’re also hearing from several sources that the company is close to announcing a third round of financing. > Continue reading on Inside Mobile Apps. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Facebook and the Parallel Surge in (Early- and Late-Stage) Valuations Posted: 03 Jan 2011 10:02 AM PST The last quarter of 2010 has ushered in a new era of vibrant activity at the very beginning and very end of the startup life-cycle. Later-stage companies like Groupon, Twitter and Facebook have come back to the trough all within the last several weeks to raise between $200 and $500 million each in what some have dubbed “Private IPOs.” The New York Times is now reporting that Goldman Sachs Group Inc. may help Facebook raise as much as $1.5 billion at a $50 billion valuation. At the other end, seed-stage startups are raising round sizes of $1 million or more that would have been unthinkable three years ago for pre-product companies. The two booms are interconnected. They feed off each other. Among early- or seed-stage companies, the power of platforms like Facebook’s have made the expected value of any given engineer much more unpredictable. The engineer hired by a startup at a salary of between $90 to 150,000 and 1.5 percent or less in equity could make several times that much by building a Facebook-powered web or mobile experience on their own. This was not as easy to do four years ago, before the platform launched. Overnight successes like Instagram, which raced to 1 million iPhone users in two months fueled by Facebook and Twitter’s social graphs, are pushing angels to take gambles on two or three-person teams even before they have built products. Meanwhile, the middle investment stages matter less as the most attractive consumer Internet companies like Twitter or Groupon seem to either rush through or bypass them. Among later-stage rounds, nimble firms like Russia’s Digital Sky Technologies can barge in with $100 to 200 million in financing without demanding the same rights that other more traditional firms require. At the same time, the tepid global economic recovery and low interest rates are pushing investors toward emerging markets and privately-held companies, even if there isn’t as much transparency. Investors are now banding together to create special funds to buy shares of privately-held, technology companies as traditional blue-chip stocks can’t promise the same returns. Now, investment banks like Goldman are taking note of tech companies that are deferring their IPOs for longer to avoid the shortsightedness and regulatory burdens of public markets. For comparison’s sake, Google had raised just over $25 million from Sequoia Capital, Kleiner Perkins Caufield & Byers and angels before going public while Amazon had raised about $8.3 million. Facebook will have raised north of $1 billion in equity investments. Right now, the companies that fit into this later-stage category like Facebook are clear IPO candidates that are profitable. But over time, as less-skilled and knowledgeable investors pour in through special funds and as valuations soar with more liquidity in secondary markets, momentum could easily get ahead of itself. That is, if it hasn’t already. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Top 25 Facebook Games for January 2011 Posted: 03 Jan 2011 09:28 AM PST Smaller developers have seen more growth over much of 2010, while many of the top titles from leading developers have lost users — in December, though, the losses weren’t so bad. And, it was also a big month for newcomers to the list with the appearance of Zuma Blitz, It Girl, and, of course, CityVille. Moreover, in case anyone has been on hiatus for a month, Zynga’s new city-builder has found itself at the top with nearly 85 million monthly actives as of today; a plateau breached by FarmVille back in February 2010. CityVille’s growth, however, took less than two months to acquire. > Continue reading on Inside Social Games. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
What Goldman Sachs’ Reported $450 Million Investment in Facebook May Mean Posted: 03 Jan 2011 08:39 AM PST Facebook has raised $500 million at a $50 billion valuation from Goldman Sachs Group Inc. and Digital Sky Technologies, The New York Times reported last night. Facebook declined to comment, while DST did not immediately respond to inquiries. The New York-based investment bank took a $450 million stake in the company while DST, which invested in Facebook at a $10 billion valuation in May 2009, invested an additional $50 million. Goldman may raise as much as $1.5 billion for the company and create a special fund that lets high-net worth individuals invest in Facebook. (We reported on the phenomenon of these special-purpose vehicles, which allow companies to skirt SEC regulations about financial disclosures back in October.) Goldman also has the right to sell part of its stake, up to $75 million, to Digital Sky Technologies. Facebook will use the funding for cashing out earlier employees, hiring talent, making acquisitions and developing new products. A couple thoughts on the deal: Goldman gets the inside track on underwriting Facebook’s IPO: The most obvious implication is that New York-based investment bank is leading the race to manage an anticipated IPO in 2012, which could bring in $50 to $150 million in fees to the New York-based investment bank. The new non-IPO: For comparison’s sake, Amazon.com raised $8.3 million and Google raised just over $25 million before their respective initial public offerings. Facebook will now have raised more than $1 billion in equity investments prior to an IPO. Avoiding an IPO may be as much about talent as anything else: Moreso than in other industries, consumer Internet companies absolutely depend upon talent. Low distribution and user switching costs mean that capital and infrastructure matter less than for other brick-and-mortar industries. The intellectual property system in the U.S. also moves too slowly to be meaningful, so startups have to iterate or die. It’s a pattern that repeats over and over; last year’s Yahoo Answers or Flickr gives way to this year’s Quora and Instagram, which may give way to something else next year. This is why having and retaining the very best engineers, product managers and designers matters. But as a company grows larger and as its valuation rises, its risk-reward ratio changes. At best, a rising tide means all employees benefit. However, a high valuation also creates a dual-class society where early employees are worth substantially more than newer ones. Over time, diminishing upside makes a company less attractive to the best technical talent, contributing to the cultural and bureaucratic sclerosis Google is seeing. An IPO would be not only a distraction to Facebook; it would mean the company would lose control over its market capitalization, and the value of the rewards it could offer employees. After going public in 2004, Google’s valuation went up by about fourfold in a year as investors aggressively priced in expectations of future earnings. Currently, Google’s market capitalization is not even double what it was five years ago — a return that pales in comparison to the multiples numerous other consumer Internet startups have generated in the same time period. Hence, a technology company’s success also contains the seeds of its own destruction. Facebook must balance between rewarding and incentivizing long-time employees to stay while making sure payoffs are attractive enough for newer employees. So far, the company has tried a combination of talent acquisitions with deals for existing employees to sell shares to specially sanctioned investors like DST. Now if you look at Sharespost bids this morning, there are multiple buy posts from investors clamoring for Facebook shares at an implied market capitalization of between $90 to $99 billion. Taking an investment from Goldman allows Facebook to ratchet up its valuation in a controlled fashion, letting it dole out rewards to old-timers while keeping the upside attractive to newcomers. Goldman’s “special purpose vehicle” should increase SEC scrutiny of secondary markets: We reported on special funds that let investors band together to buy shares in privately-held companies earlier this fall. Because these funds are counted as a single investor on the cap table instead of several, they help Facebook bypass the sensitive SEC 499-shareholder limit. When a company has 500 or more investors, it needs to start making financial disclosures similarly to if it were a publicly-held entity. The Securities and Exchange Commission began investigating these funds last month in a move that could pressure Facebook to go public, according to The New York Times. Facebook may use some of the funds to buy a campus: With about 2,000 employees, it’s about time that Facebook start considering a permanent home. Eight years after it was founded, Google spent $319 million for what would become the Googleplex. It wouldn’t be surprising if Facebook did something similar. The company is somewhat uncomfortably split between two buildings on California Avenue in Palo Alto. TechCrunch reported, and we’ve also heard from sources, that Facebook is looking at property in Menlo Park. DST may have helped snag the Facebook deal for Goldman Sachs: Two of the four DST partners hail from Goldman Sachs Group Inc. It wouldn’t be surprising if they helped arrange the deal.
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Announcing Inside Mobile Apps: Tracking the Convergence of Mobile Apps and Social Platforms Posted: 03 Jan 2011 08:02 AM PST Nearly five years ago, when Facebook had 8 million users, we launched Inside Facebook to provide developers, analysts, and marketers with in-depth information, research, and data on the Facebook ecosystem. Three years ago, when the social gaming movement began on top of the Facebook Platform, we launched Inside Social Games to do the same. Today, we are excited to announce Inside Network's third site dedicated to developers and analysts: Inside Mobile Apps. As social and mobile platforms have begun to converge over the past couple of years, it's already become clear that we're going to see a wave of amazing new products – and tremendous new opportunities – at their intersection. Like Inside Facebook and Inside Social Games, Inside Mobile Apps will be dedicated to serving developers and analysts interested in tracking the convergence of mobile apps, social platforms, and virtual goods. We're at the beginning of an exciting new phase in the growth of the social web. Important things have happened over the last couple of years that are enabling and will increasingly enable new classes of applications that were never before possible. This convergence of social and mobile platforms will fuel new markets for developers and advertisers, and we'll be tracking everything closely on Inside Mobile Apps.
We're looking forward to tracking not only the applications but also the people and companies behind them that are leading the charge into this new and exciting space. We believe some interesting new companies will be created as the worlds of mobile and social networks collide. It should be a fun ride. Please drop us a line any time! | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Innovative Games Join Holiday Apps on This Week’s List of Fastest-Growing Facebook Apps by DAU Posted: 03 Jan 2011 07:30 AM PST
Prosperous New Year To All My Friends Badoo has also nearing a milestone of sorts: once it adds just half a million more MAU, it will surpass the largest size that its competitor, Are You Interested?, ever reached. It appears that Badoo may hold onto users a bit better, with a stickiness of 10 percent to AYI’s 7 percent. If you want to parse through all the holiday apps, look down to Monster Galaxy and Zuma Blitz, two games that both muscled in with 1.3 million new MAU. What’s interesting about these titles is that neither is in the sim category that has been so dominant over the past few months; each also has higher production values than many recent titles. |
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