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Facebook – 300 million and counting!



This week, Mark Zuckerberg, Facebook's 25-year-old CEO, announced on the site that the social network's active membership had reached 300 million. It's an incredible story for a company that only celebrated its 5th anniversary in February of this year. As it's fond of telling people in its press releases, if Facebook was a country, it would now be the 4th largest in the world!

One of the most impressive things about Facebook's growth is how it has managed to handle the technological infrastructure, or "back-end" of the company, without too many headline-grabbing outages or system crashes. Contrast the Facebook experience with Twitter, which has an unenviable record of vulnerability to cyber attacks in its admittedly much shorter history. Zuckerberg gives due credit to his staff in his posting, pointing out that the site is maintained on a ratio of one engineer to every one million users!

Zuckerberg also attracted the attention of the business and analyst communities by stating that Facebook had finally turned a profit, or in his words had become "cash flow positive", in the second quarter of this year. The fact that it has taken Facebook so long to get to that position with such a huge membership, and after raising an estimated $640 million along the way, is another reminder of how the Internet demands an entirely different business model from a traditional bricks and mortar operation.

Estimates of Facebook's worth vary dramatically based on who you talk to. When Microsoft bought a 1.6% percent stake in the company back in October 2007, the investment suggested that the company had a market value of around $15 billion. However, that was before the current recession. Earlier this year, it was reported that the company put a valuation on itself of somewhere around $3.7 billion when it filed court papers as part of a proposed legal settlement. Since then, Facebook appears to have bounced back nicely. In May, it closed on a $200 million investment from the Russian Internet conglomerate, Digital Sky Technologies, which put the valuation back up around $10 billion.

The Russian investment, following on the heels of an earlier $100 million investment from Chinese billionaire Li Ka-Shing, shows the global nature of Facebook's operation. Over 200 million of Facebook's 300 million active users are from outside the United States. Members can currently browse Facebook in 65 different languages and dialects, all of them instantly available through the main site's account settings.

Whatever the future holds for Facebook, and with a worldwide population of 6.7 billion many would argue there is plenty of room for additional growth, it has become a phenomenon of this or any other era. There are not too many companies that have ever been able to claim a customer base of 300 million in their 5th year of existence!  



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