Facebook Worth $50 Billion? Goldman Thinks So

by Todd Shriber

Remember in 2007 when Microsoft (MSFT) invested $240 million in Facebook in a deal that valued the social networking site at $15 billion? Mr. Softie endured his fair share of criticism at the time, but that deal could prove to be one of the smartest the company has ever done – and Goldman Sachs (GS) is showing the world why.

Wall Street’s most profitable investment bank and a Russian investor are investing $500 million into Facebook (Goldman’s share is $450 million) in a deal that now values Mark Zuckerberg’s firm at a whopping $50 billion, according to DealBook.

The Russian investor, Digital Sky Technologies, already owns stakes in Groupon and Zynga and has previously invested $500 million in Facebook, DealBook reports. Goldman has the right to sell part of its stake, up to $75 million, to the Russian firm, and for Digital Sky Technologies, the deal means its original investment in Facebook, at a valuation of $10 billion, has gone up fivefold, according to DealBook.

For its part, Facebook is still a private company, but with an estimated market value of $50 billion, it’s probably safe to say pressure on the company to go public is going to increase a tad. The Facebook IPO is already widely anticipated, so getting involved will likely become harder than scoring Super Bowl tickets.

At $50 billion, Facebook would have a larger market cap than Dow Jones Industrial Average components Alcoa (AA), DuPont (DD) and Travelers (TRV), and puts the social networking giant within earshot of Home Depot (HD) and Kraft (KFT). No wonder the Winklevoss twins want to re-sue Facebook for more coin.

And for first time in a very long time while, Microsoft looks quite smart.

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