Facebook CEO doesn't lose sleep over company's $15B valuation

IDG News Service - Facebook Inc. isn't starved for money, and it doesn't obsess about the $15 billion valuation that a Microsoft investment gave it last year, CEO Mark Zuckerberg said Thursday.

Facebook's ad business is humming along nicely, generating a healthy cash stream both from direct sales to big brand marketers and from smaller advertisers that buy space on the site using its self-service tools, Zuckerberg said at the Web 2.0 Summit in San Francisco.

Generating "hundreds of millions of dollars" in annual revenue has allowed the company to focus on growing its worldwide user base this year to about 125 million members and to not have to make revenue generation its top priority, he said.

Industry pundits have suggested recently that, given its fast growth, Facebook may be approaching a cash crunch that could affect its operations and force it to seek more funding, but Zuckerberg dispelled those ideas.

Likewise, the staggering $15 billion valuation doesn't weigh around the necks of staff, nor does it dictate the company's business strategy, according to Zuckerberg. "We don't feel any pressure to live up to the valuation," he said.

By the same token, Microsoft Corp.'s $240 million investment is just one piece of the companies' collaboration, which also includes partnerships for online ads and search technology, so Zuckerberg isn't worried about Microsoft CEO Steve Ballmer regretting what he paid for the Facebook stake. "They have been a really good partner for us," he said.

These days, Facebook, which now has more than 700 employees, is especially interested in recruiting talented technical staff, such as engineers and product managers, and growing its direct sales force — in particular internationally, he said.

Asked by conference chairman John Battelle to comment on criticism that Facebook is too much of a walled garden, Zuckerberg said the company's goal is to continue opening itself up, but that will be a gradual process.

It started in earnest last year with the launch of the Facebook application development platform, which lets external developers create applications for the site, and continues with Facebook Connect, the company's nascent data portability initiative to let members export their Facebook data to other sites.

Questioned about whether Facebook is purposefully not participating in Google-sponsored efforts like the OpenSocial set of APIs for building social networking applications, Zuckerberg said there isn't an intentionally adversarial attitude toward the search giant.

Rather, Facebook is weighing its options and evaluating OpenSocial, which it considers inferior to its own Facebook platform, he said. It remains to be seen which effort will become an industry standard, he said. Facebook this year open-sourced a big portion of its platform.

Reprinted with permission from

IDG.net
Story copyright 2009 International Data Group. All rights reserved.