Know When To Hold 'Em, Know When To Sell Out
from the hindsight-is-20/20 dept
Friendster has been looking for a buyer for some time, while its selling price keeps dropping and dropping. About this time last year, $200 million was being tossed around as Friendster’s buyout price. Now PaidContent reports it’s been offered to Viacom for just $5 million — but the media giant’s even balked at that, about a month after offering $20 million for the one-time social-networking supersite. It looks like the tale of Friendster will go down as a cautionary one, both for companies investing large sums of money in the latest online fad, but also for entrepreneurs whose greed can often outpace their business sense (especially when the implosion was so easy to see coming). The word on the grapevine is that Google offered to buy Friendster for $30 million worth of pre-IPO stock in late 2003, but Friendster founder Jonathan Abrams rejected it in favor of $13 million in VC funds because the firms valued the company at $53 million. Of course, now, those firms no longer want to fund the company, and Google’s stock is worth nearly $500 per share. Looks like the number of people marking Friendster as a friend in their profile is dwindling.