Kara Swisher

Recent Posts by Kara Swisher

Facebook Funding: Still Talking

Please see this disclosure related to me and Google.

Poor Facebook VP Owen Van Natta–locked away all day on such a lovely Bay area weekend.

facebookmouth

He and other Facebook execs spent Saturday and Sunday blabbing away with potential partners into the night, as Facebook looks to complete a commercial deal with either Yahoo, Google or Microsoft to serve its international ads.

But the execs are also trying to nail down a big funding that will potentially give the hotsy-totsy social network a giant slug of cash, as well as a lofty $15 billion valuation.

No deal as yet, but sources close to Facebook said it was now a horse race between Microsoft, which already serves Facebook’s ads in the U.S., and Google. Yahoo, sources said, is a long-shot dark horse in the bidding.

According to sources, Google is not as keen to make a big investment in Facebook (although it would be willing to make a token one), preferring that most of the funding come from private equity investors. It is also driving a harder bargain related to guaranteed ad revenues.

Microsoft, sources have said, is more interested in a bigger investment, although the company is not as willing to completely redo its current ad deal with Facebook or make an international one that would disadvantage it considerably more.

BoomTown has pretty much been out in front of most of the Facebook coverage of late, questioning the start-up’s still nascent business plan (or lack thereof) and purplish press hype, the ridiculousness of the explosive valuation and, most recently, the juvenile nature of its vaunted third-party apps offering.

I have been a bit tough on Facebook, but for good reason. As much as I think the social network is powerful in its potential, is a terrific product that knits together a truly unique user experience and represents a leap forward in how consumers use the Web on a daily basis, I also believe its underpinnings must be examined more closely.

In other words, the massive hype around Facebook needs some serious de-hyping.

Still, as Valleywag correctly reported here, I have what is a pretty big conflict of interest (Google exec Megan Smith, whom I affectionately like to call “The Useless One”) related to the particular current deal being discussed with Google, I am going to bow out of analyzing this specific deal closely, except to point to my past writings on Facebook, including breaking news of Google’s interest in Facebook.

(Please take time again to read my long disclosure on the issues related to Google and me.)

That does not mean I do not hope to break news of what Facebook finally manages to decide to do, both with regard to partners and its funding, but that I will bow out of parsing this deal in excessive detail.

(In sum, though, my coverage so far: An overhyped IPO might provide cover, but good luck making serious money on Facebook ads, whichever one of you solar-powered brainiacs, you software behemoths, you sacred cow disrespecters wins! At this point, I remain solidly dubious.)


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There was a worry before I started this that I was going to burn every bridge I had. But I realize now that there are some bridges that are worth burning.

— Valleywag editor Sam Biddle