• Silicon Alley Insider, Wednesday, May 27, 2009 1:15 PM

Don't be fooled: Facebook's not really worth $10 billion. At least, that's the refrain from many Web pundits following the $200 million investment in the company by Russian technology outfit Digital Sky Technologies. Silicon Alley Insider's Henry Blodget notes that the claim is valid, too, because DST bought preferred stock, not common stock, which means that Facebook's common valuation remains below $10 billion.

Even so, Blodget says that too much emphasis on Facebook's real valuation downplays the significance of CEO Mark Zuckerberg managing to pull together another huge round of financing for a relatively small share of his company. Instead of "Facebook's Not Really Worth $10 Billion," Blodget argues that a better headline would be: "Financier Supreme Mark Zuckerberg Does it Again, Raises $200 Million for Only 2 Percent of His Company." Indeed, the real story here is that Zuckerberg has raised more than $500 million from DST and Microsoft, respectively, while giving up just 5% of Facebook.

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