Report: Facebook Waits for $2 Billion Bid

Facebook founders reportedly reject a $750 million offer to buy the company

Facebook.com is for sale, and its young owners have rejected a $750 million offer with hopes of landing a $2 billion deal, according to a BusinessWeek story posted online Tuesday.

On the campus where the social networking website first launched, students wondered whether Facebook.com would retain its appeal to undergraduates if the founders sell their start-up venture to a conglomerate. And industry analysts are wondering whether the Facebook.com team has passed on a lucrative deal.

Meanwhile, Facebook.com spokesman Chris R. Hughes '06 would neither confirm nor deny that the site is for sale.

“The BusinessWeek stories that ran last week and the rumors that are flying around on the internet are just that: rumors,” Hughes said in a phone interview yesterday.

Online social networking behemoth MySpace.com was sold for $580 million to News Corp. last year. MySpace received three times as many unique visitors in February as Facebook, according to market research firm comScore.

But Facebook.com’s highly coveted access to college students and recent alumni might draw larger offers.

The chairman of the internet publishing firm Federated Media, John L. Battelle, wrote on his weblog: “Me? I’d take the $750 million.” But Battelle, who is the author of the book “The Search: How Google and Its Rivals Rewrote the Rules of Business and Transformed Our Culture,” said in a phone interview from his home in San Rafael, Calif., yesterday that some young Web entrepreneurs who turned down multimillion-dollar offers early on reaped rewards in the long run.

“You do not sell out early if you believe your company is going to be huge and going to change the world,” Battelle said, citing the example of Google founders Larry Page and Sergey Brin, who declined to sell their site in its infancy. Both are now worth an estimated $11 billion each, according to Forbes magazine.

“On the other hand, there are plenty of people who sold too late or wish they had sold when there was an offer on the table,” Battelle said.

For instance, the pioneering social networking site Friendster.com did reject takeover bids but has seen its popularity decline, as MySpace and Facebook have gained ground.

Friendster’s fizzle raises the question of whether Facebook.com can maintain its site traffic.

“I think if it sold out, I would not use it for the same reasons I would not use MySpace, because it would be stalker trash,” said Joshua H. St. Louis ’09. “It would just be an advertisement page for corporate America.”

As of now, though, the site has a distinct undergraduate-oriented appeal, said Lisa C. Rosenfeld ’09. “It’s nice that the people in charge of it right now can make changes from the point of view of a student,” she said.

Luke A. Langford ’06-’08 expressed strong support for the founders of Facebook.com. “If they want to sell, I’d say good for them. They had a good idea. It became popular. They should cash in on it while it’s still hot,” Langford said.

And Facebook.com’s success sparks school spirit in some students.

“I have a sense of pride because [founder] Mark Zuckerberg represented us in a respectable manner,” said Robert J. Ross ’09. Ross said that if the site changes ownership, “I don’t think that would prevent people already on Facebook from using it.”

—Staff writer Joyce Y. Zhang can be reached at jyzhang@fas.harvard.edu.