How Much Is Facebook Worth?

There is a lot of buzz surrounding the value of Facebook. Currently they are growing like gangbusters but there are no signs of similar growth rates in their advertising revenue. One thing that is interesting though is the rapid growth in users from the older demographic. The rapid growth in this area is a phenomenon not previously experienced by other social networks. The wide range of demographics allows for developers to create applications that cater to each of those demographics.

Advertisers also want a piece of the action and that is where all the revenue will come from. Lee Lorenzen likes to project Facebook’s valuation at $100 billion but most would suggest this is due to his stake in Facebook. He developed the Altura Ventures investment fund for investing in Facebook applications. Lee argues that Facebook is worth $100 billion based on their future entry into the people search business.

Even if people search accounts for over 30% of the search online, I’m not quite sure that this values them at $100 billion. Google’s market capitalization is around $150 billion. They have far more capital invested in expanding their reach then Facebook currently does. Obviously I think Facebook is a phenomenal platform but I think at their current size, talks of $100 billion are slightly ridiculous. How much do you think Facebook is worth?