Tha Face Deal Book Research Paper Example | Topics and Well Written Essays - 1250 words

Tha Face Deal Book - Research Paper Example Most of the financing Facebook Inc. was obtained as ventures. The ventures were given with an exchange of obtaining the rights of ownership of the company. Accel Partners invested $12.7 million at a valuation of about $100 million. They also invested in another transaction worth $27.5 million with the Greylock Partners. This investment earned them a valuation of $525 million. The Accel Partners and the Greylock Partners invested in this young company due to its promising market service. The company had grown so that it could serve millions of students around the campuses. The investment opportunity was to allow for its growth in the market. The Microsoft Corporation and the Digital Sky Technology raised their contribution in the form of equities.This financing was aimed at the elevation of the Facebook Inc., which was a young promising company. (Ferrera, 2012). The cumulative investment has seen the listing of Facebook as the most used social network over the years. This led to the e ventual filing for an IPO on February 2012 and started selling stock in May 2012. This tremendous growth can be credited to the investment that has overseen the financial credibility of the company. The investors had an aim of obtaining a valuation in the company through the acquisition of ownership rights of the company. The Microsoft Corporation invested to the company in order to obtain the 1.6% stock and to be allowed to advertise on the site. The Accel Partners requested a post of being a board member of the company thereof being central in running the company (Baloun, 2007). Therefore, the financing of the Facebook Company was a beneficial venture for both the company and the investors. Uses of the finances The Facebook Inc. started as a small company with very few employees. At that time, they only had 10 Employees.The Company had an aim of recruiting new employees to aid in the servicing of its clients. The event that was carried out and it drew about 700 people. The company was also experiencing losses that were spurring the possibility of being sold to Yahoo or other larger media groups. To fight this pressure, there was a need to allow investors to venture into the company financially. This acted as a source of capital for investing in the expansion plans beyond the old environment. The company added high school networks, international school networks and photos to the social networking pages (Sutherland, 2012). In order to obtain a valuation in the economy, the Microsoft Corporation invested $240 million for the 1.6% stake in the company. This enabled Facebook to spread and improve on their applications on the website. The company could get recognition in the corporate market with a high financial basis. Another project was the acquisition of the international headquarters in Dublin (Carver, 2012). The acquisition of other companies such as Connecticut was also another project that required a great deal of funding. This was after the settlement of the suit against Facebook. The funding from Microsoft, Accel, Greylock, and Digital Sky Technologies was instrumental towards the growth of this company to the point of obtaining an IPO. Current valuation The company has provided varied valuation standards in the current period. The increase in the target price of the stock before valuation is a major boost for this company. The company considers their revenue growth, the operating