One of the richest men in the world has just gotten a little bit poorer.
Facebook CEO Mark Zuckerberg's fortune fell $2.2 billion today after investors and Wall Street sold off shares in Facebook, dropping the company's stock 11 percent just one day after it went public.
After today's fall, the company is valued at $93 billion and Zuckerberg has a 24 percent share, making him the 26th ... [ read the full article ]
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Originally posted by salsa36: Why FB is so expensive? Isn't free?
It's not expensive, it has economic value in that it has the ability to make lots of revenue through advertisements and selling statistical data to company's through data mining using the millions of FB users. Through profiling them.
The statistical data you can collect and then mine for information about how different types of people interrelate and their likes dislikes etc, is worth a lot of money. Businesses pay a lot for it because they can use it to better promote products and design other products for the consumer to buy that they actually want/need to buy.
If you can understand the market you can take advantage of it.
All this means that FB (The business/corporation) can be valued so highly because it has the potential to make lots of money.
People seen 900 million active users and thought to value it at 150 billion then though no hang on that might be too much, so it got dropped to a proper figure like 110 billion.
in the real world though it was never worth 100+ billion it should have gone up for around 10 20 billion at the most.
once people started buying shares once they had gone up very slightly, the owners sold them out, Mark Zuckerberg's sold some shares plus a few other at fairly large % like 5 to 10% and the share price will only drop pretty rapid.
Mark Zuckerberg is only a kid he really shouldn't have gone the whole public thing, he'll probably be kicked oput in a year or 2 for not being a good CEO people already want to linch him.
