Here’s the big one – Facebook, the popular social networking website, has announced it’s received a $200 million investment round from Digital Sky Technologies (DST), in exchange for 1.96 percent in equity stake. Facebook said its stock is now valued at $10 billion, a drop from October of 2007 when Microsoft paid $240 million for a 1.6 percent stake. Facebook’s stock was then valued at $15 billion.
The Russian investment firm, based out of London and Moscow is also planning to purchase at least $100 million of Facebook common stock from existing stockholders. The two companies will announce more details at a later date.
Digital Sky Technologies says its assets account for over 70 percent of all page views in the Russian speaking internet. It’s invested in Mail.ru, as well as social networking sites Forticom and vKontakte. Currently those sites address a combined population of about 350 million.
Mark Zuckerberg, CEO of Facebook explained that DST stood out, “because of the global perspective they bring backed up by the impressive growth and financial achievements of their internet investments.” Currently, Facebook has over 200 million users with 70 percent of those outside of the U.S. Facebook hopes to make use of DST’s experience with foreign social networking companies to expand and scale.
Here’s the full press release from Facebook:
PALO ALTO, Calif. — May 26, 2009 — Facebook today announced that
Digital Sky Technologies (DST), one of the leading internet investment
groups globally with significant stakes in Eastern European and Russian
internet businesses, has made a $200 million investment in Facebook in
exchange for preferred stock, representing a 1.96 percent equity stake
at a $10 billion valuation.
In addition, DST has indicated that
it is planning to offer to purchase at least $100 million of Facebook
common stock from existing common stockholders that would facilitate
liquidity for current and former employees’ vested shares in the
company. The details of the plan are expected to be announced to
eligible participants during the summer. Consistent with Facebook’s
practice with other recent investors, DST will not be represented on
the Facebook board or hold special observer rights.
“This
investment demonstrates Facebook’s ongoing success at creating a global
network for people to share and connect,” said Facebook CEO Mark
Zuckerberg. “We’ve worked hard to bring more than 200 million people –
70 percent outside of the U.S. – onto Facebook to share with friends,
family and co-workers. A number of firms approached us, but DST stood
out because of the global perspective they bring – backed up by the
impressive growth and financial achievements of their internet
investments. We’re looking forward to working with the DST team.”
“Our
investment experience in other regions reveals the tremendous value
social networking companies create as they redefine how people
communicate and interact,” said Yuri Milner, chief executive of DST.
“By every important metric – user growth and engagement, technological
innovation and financial performance – Facebook is on a similar
trajectory, though on a much more global scale. We’re delighted to
invest in Facebook, Mark and his management team as they make the world
more open and connected.”
Based in London and Moscow, DST is a
well-respected investor in a number of successful internet companies,
holding significant interests in Russia and Eastern Europe, such as
Mail.ru, Forticom and vKontakte. DST’s main assets account for over 70
percent of all page views in the Russian-speaking internet and its
social networks are the market leaders in more than 13 countries,
addressing a combined population of more than 350 million.
DST is
run by its three partners who have complementary backgrounds in
operations, investments and finance: Yuri Milner, previously CEO of
Mail.ru, the #1 Russian language website; Gregory Finger, previously
head of the Moscow office of NCH, a multi-billion dollar hedge fund;
and Alexander Tamas, previously co-head of internet and software
coverage in EMEA for the Investment Banking Division of Goldman Sachs.
With its advanced understanding of opportunities in technology and
social media, DST is a good fit for Facebook and an insightful partner
that can help unlock additional growth opportunities.
Facebook is
holding a teleconference for the media today at 9:45 a.m. Pacific
Daylight Time. From the U.S., participants should dial (877) 809-9539.
Participants outside the U.S. should dial (706) 679-8713. Please
reference conference identification number 11871648 to join the call. A
replay of the teleconference will be available for one week. To access
the replay, U.S. participants should dial (800) 642-1687 and
participants outside the U.S. should dial (706) 645-9291. Please
reference conference identification number 11871648.
About Facebook
Founded
in February 2004, Facebook’s mission is to give people the power to
share and make the world more open and connected. Anyone can sign up
for Facebook and interact with the people they know in a trusted
environment. Facebook is a privately held company and is headquartered
in Palo Alto, Calif.
About Digital Sky Technologies
DST
was founded in 2005 and is the largest internet investor in the
Russian-speaking and Eastern European markets and one of the leading
investment groups globally to exclusively focus on internet and
internet-related companies. DST is a privately held holding company
backed by leading Russian and Western financial institutions. DST has
offices in Moscow and London. For more information please visit http://www.dst-global.com.
