DST's latest investment suggests that
Facebook now has a higher market value than established media and tech companies that generate significantly more revenue, like CBS Corp. and Salesforce.com. According to JMP Securities analyst Sameet
Sinha, DST is valuing Facebook's common shares at 13 times expected 2009 revenue, far higher than the 2.2x multiple common to online advertising-based businesses, or the 6x multiple that Google
currently trades at. Sinha said that Facebook's growth in sales and users amid a particularly tough business environment are the factors that drove the lofty valuation. "Essentially, people's
expectations that this could be the next Google," he said.
As part of its agreement to buy $200 million worth of preferred shares, DST said it would also buy $100 million worth
of Facebook common stock. Facebook employees and ex-employees are eligible to participate in the offer, Facebook said, but the company's senior management, board members and holders of 5 percent or
more of Facebook are not eligible due to legal reasons.