It had to happen! We have talked about widget apps and the facebook platform on venturewoods before. A pure play facebook app “Where I’ve been” reportedly got acquired for $3m. It might seem like a small amount compared to the billions that make headlines these days, but IMHO its just the starting point — this thing is going to get more momentum.
So what do you think? Is someone calling a beginning of a bubble 🙂 There is an arbitrage here – if you have a smart facebook idea, and can bootstrap it well (remember, very little marketing money required here), this might be your first million bucks!
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I agree. Two acquisitions have already happened – Sidestep taking Extended Info and Slide buying Favourite Peeps. The latter was valued at $60K – a 4.6 cent per user deal.
More power to them. This is a fabulous market if the deal sizes start showing big moves. The limits seem to be about $25 per user for entire SN sites, so perhaps a dollar or so per user for apps?
well, so I cried wolf. However, I think this “will” happen – and I draw lessons from google adwords (substantial lead gen businesses based entirely on google search platform) and secondlife economy. Open application platforms where users spend time is a business ecosystem, and there is value to be created…
http://news.com.com/8301-13577_3-9761584-36.html
Turns out it ain’t so. Darn.
But I like what he says: “We are, however, exploring all avenues to maximize the value and usefulness of our product for our user base and we expect to announce new product features/enhancements,” he explained, “from both internal development and through strategic business partnerships, in the weeks and months ahead.”
The more I think about it the more I realize you could apply this statement to any (product) company anywhere in the world. The generic base class of press releases. (Okay, too much coding has happened)
The $3m number is already being contested and is apparently based on a single source, that too from the blog of an app developer. Could be true/false and I hope it is false because it is an insane valuation for a product that has little life outside the FB ecosystem, kind of sort of agreeing with RYK on that point, though I don’t agree with the next one.
FB has data modeling that’s amazing, kind of like even brilliant from a tech perspective, the business case for it is still suspect, because any decent quantum of advertising on the platform (other than the banner spots) will lead to its ruin eventually.
Facebook is a good way to distribute cheaply.
However (I am going out on a limb here), I find that facebook has not provided a the right way to integrate applications and thus the users stickiness of an application is suspect.
I also feel that Facebook itself is a weak product (way way out on limb), its neither business nor pleasure: blue and stiff with mainly entertainment features.
I follow warren buffet’s commonsense rules, I wouldn’t buy a facebook app for $3M, no matter what anyone says.