Private company valuations on SecondMarket (and other similar “exchanges”) make for great blog fodder, but I’m not sure I buy into the hype. The latest result for Facebook is a $25 billion valuation … for a company that celebrated being cash flow positive a year ago and has yet to turn a profit.
Queue the sock puppets and launch a black rocket. It’s 1999 all over again.
Let’s compare it to the actual values of public companies like AOL ($2.3 billion) and Yahoo! ($21 billion), as reported by TechCrunch today. Facebook at $25 billion without any real liquidity? I’m having trouble stomaching that one. Of course, I’m something of a skeptic, so take my opinions with a grain of salt.