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article imageFacebook Sold 10% of Shares?

By Chris V. Thangham     Jun 13, 2007 in Business
The Times Online UK is reporting Facebook sold 10 per cent of company shares to buy more servers a year ago to meet the sudden demands of users worldwide. The report says Facebook founders were forced to dilute their stock to pay for the hardware needs.
Facebook has remained in private hands for a long time, despite having a high market value. Facebook founder Mark Zuckerburg so far has rejected big names to buy the company.
But today, there is a big rumor that Facebook sold 10 per cent of its shares a year ago because it didn’t have enough money to pay for the hardware to handle the big increases in its users in the U.S. and worldwide.
The article first appeared in Times Online UK edition, it appeared to be taken down without explanation, and now is live again at this link.
According to the report: Facebook is understood to have issued an urgent call for funding last year when it realized it had not to leased enough servers to store the rapidly increasing amount of data uploaded by its subscribers which now number 24 million, including 1.4 million in the UK.However, Mashable says the story may not be true because Facebook has received a lot of funding and also has significant revenues on the site. Zuckerburg is very careful about his site and has said he wants to keep it under his control for a long time. But since he is funded by investors, the company could have pressured him to sell stock to pay for hardware back then.
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