Finance of Facebook....money money money..!!!!!

Given the situation other social networks the web are facing, Facebook is in a good position financially. While it hasn’t managed to get acquired like its rival MySpace (despite some rumors about an $800m deal with Viacom), it’s been quite lucky in most aspects. For its initial funding, it received $500,000 from Peter Theil, co-founder of PayPal. A few months later, it was also able to get $13 million from Accel Partners, who are also investors in 15 other Web 2.0 startups, and $25 million from Greylock Partners, making their overall venture equal to approximately $40 million.

For users, Facebook’s core service is completely free and ad-supported. In fact, in August 2006 Facebook signed a three year deal with Microsoft to provide and sell ads on their site in return for a revenue split. The deal followed an announcement from Facebook’s direct competitor MySpace who signed a similar deal with Google.The youthful demographic that both the services attract is highly prized amongst advertisers and should return a good amount of revenue for both the services to stay alive – and profit.

On July 17, 2007, Zuckerberg said that selling Facebook was unlikely because he wanted to keep it independent, saying "We're not really looking to sell the company... We're not looking to IPO anytime soon. It's just not the core focus of the company."

In September 2007, Microsoft approached Facebook, proposing an investment in return for a 5% stake in the company, offering an estimated $300–500 million. That month, other companies, including Google, expressed interest in buying a portion of Facebook.

On October 24, 2007 Microsoft announced that it had purchased a 1.6% share of Facebook for $240 million, giving Facebook a total implied value of around $15 billion.However, Microsoft bought preferred stock that carried special rights, such as "liquidation preferences" that meant Microsoft would get paid before common stockholders if the company is sold. Microsoft's purchase also included rights to place international ads on Facebook.

In November 2007, Hong Kong billionaire Li-ka shing invested $60 million in Facebook.

In August 2008, BusinessWeek reported that private sales by employees, as well as purchases by venture capital firms, had and were being done at share prices that put the company's total valuation at between $3.75 billion and $5 billion.

hmmmmm...so facebook is making money from everywhere.....!!!!!!!!!