The Rise Of Facebook: Path to World Domination

Posted in Social Media • Posted on 7 Comments

Facebook. The social media masterpiece all of us, more or less, use for personal or business reasons. Facebook is considered to, again, more or less rule the internet. This social media monster bringing in clients and prospects to companies, it’s a great tool for businesses and freelancers alike. Facebook will attract one seventh of the World’s population by the end 2012. Everything you would like to have in social media featured by one single company, on a single web page,  having a single descriptive word to be assigned yet: dominant.

I am aware of the fact that you can use it, know its basic features and know what it can do for you. I will discuss statistics and show how Facebook went from a “garage-born” company to a World giant dominating in the web.

Image by jdlasica.

Facebook’s stock market launch is $10 billion, 6 times bigger than its closest competitor; you may have heard of them: Google. With Facebook likely to be valued at around $100 billion, this would make it bigger than Disney, Amazon, HP, Cisco Systems and McDonald’s. You’ve heard of those five as well, all founded many years before Zuckerberg was even thinking of applying to Harvard. Between Google, Microsoft, Yahoo! and Facebook, although only 4th in 2011 by the daily number of visitors, Facebook holds a well-deserved first place in ad revenue. Facebook had by the end of 2011 a projected revenue of $4.2 Billion. Well, although Apple made that amount in three weeks, it is still impressive for a company that doesn’t sell products, but only advertising space.

Investments

Different people and companies invested money in Facebook rise at various stages in it’s lifetime – all of their investments paid off. Here are some statistics which are almost one year old, meaning the value of their investments is actually higher today. Below you can see the name of the company or the persons, how much and when the investment was made and how much it was worth by June 2011. Unfortunately not all the valuations are known, so we will just name the investments and periods.

  • Peter Thiel, Reid Hoffman (2004) – $500K – $10 Million
  • Accel Partners, Mark Pincus, Reid Hoffman (2005) – $12.7 Million – $100 Million
  • Greylock Partners, Meritech Capital Partners, The Founders Fund (2006) – $27.5 Million – $2 Billion
  • Microsoft (2007) – $240 Million – $15 Billion
  • Li Ka-shing (2007) – $60 Million – ?
  • Europeans Founder Fond (2008) – $15 Million – ?
  • Li Ka-shing (2008) – $60 Million – ?
  • Triple Point Capital (2008) – $100 Million – ?
  • Digital Sky Technologies (2009) – $200 Million – $10 Billion
  • Elevation Partners (2010) – $120 Million – $35 Billion
  • Goldman Sachs, Digital Sky Technologies (2011) – $1.5 Billion – $50 Billion

Now let’s move on to the “population” of Facebook, almost three times bigger than the population of the United States. Around 80% of the users on Facebook are from outside the US. Looking at the number of internet users vs. Facebook users from all the World’s regions can even give you goosebumps:

  • North America: 272 million internet users – 168 million Facebook users
  • Latin America: 215 million internet users – 115 million Facebook users
  • Europe: 476 million internet users – 279  million Facebook users
  • Asia: 922 million internet users – 153 million Facebook users
  • Africa: 119 million internet users – 31 million Facebook users
  • Middle East: 69 million internet users – 16 million Facebook users
  • Australia: 21 million internet users – 13 million Facebook users

The statistics are from 2011, so the number of internet users and Facebook users has increased a bit since then. If Facebook is able to dominate Asia as they dominate the other regions, they will probably reach 1.5 Billion users in few years.

Zuckerberg and his history

None of this would have been possible without the work of Facebook’s co-founder and CEO Mark Zuckerberg. Born in 1984, today he is the richest 28 year old in the world and the youngest billionaire. He can speak five languages and dropped out of Harvard to head for Silicon Valley and run Facebook. He still attends board meetings in sandals and had business cards entitled “I’m CEO b***h”. Quite the rebel for such a successful business man. He owns 24% of Facebook and at Facebook’s valuation of $100B, this would mean $24 Billion in his pocket if the company was sold.

The online display ad revenue is another hot one for Facebook, owner of 17.7% of the whole market, with Yahoo! following in at 13.1%. Google is third with 9.3%, while Microsoft comes in fourth with 4.9%. Multiple other companies altogether own 55% of the market.

Financial growth and power

Looking at Facebook’s valuation throughout time, it is incredible how the Palo Alto company grew so much, from nothing to $10 Billion in eight short years. In 2004 it was only worth a few thousand dollars and was limited to Harvard undergrads. Only five months after its release Zuckerberg rejected a $10 Million offer from Friendster after Peter Thiel, PayPal co-founder, invests half a million dollars in the social media company. Facebook had already started to attract the attention of internet experts.

One year later the company was valued at around $100 Million after getting $12.7 million in funding from Accel Partners. Another year passes and Facebook rejects a $750 million acquisition offer and raises $2 billion from investors. In April 2006 Facebook is reported to be valued at around $525 million. One year later Yahoo! offers to buy the company for $1 billion, but the offer is declined. Although Facebook declines the accurate estimate of the investment worth, Microsoft raises $240 million for Facebook by the end of 2007.

After Facebook started to refuse more investing in the company, the value plummeted from $4 billion to half of it. After a short period Facebook starts to raise funds again from different investors and its value reached $9.75 billion by November 2009 and to more than $10 billion as of today.

If you think Facebook is just a money making machine for its founders and investors, you are in for a big surprise. Europe and the European Union have a lot to thank Facebook for. Zuckerberg’s company adds an estimate of more than $15 billion Euros to the European economy. Facebook’s activity and platforms support 36,000 jobs in Germany, 35,000 jobs in the UK, 34,000 in Italy, 22,000 in France, 20,000 in Spain and 5,000 in Ireland. Facebook creates jobs and has a powerful economic impact on the countries above and some others.

User behavior

Ten percent of all the pictures uploaded on Facebook are profile pictures. Women tend to change them every other week, while men every third week. Every year users upload more and more photos on Facebook. The number of uploaded pictures per year for each user has tripled since 2006.

130 friends is the average number of friends a person has on Facebook. The main reasons behind sending a friend request to somebody are knowing him/her in real life, having mutual friends, being part of the same business network and being physically attracted to him/her. Seven percent of people say they just add everybody they see on Facebook without any reason.

While adding friends gives us some obvious conclusions, removing friends comes with some surprises. 55% of the people who remove friends do it because of offensive comments and 41% because they don’t know the person well enough. Lack of interaction, depressing comments, trying to sell something, political comments or updating the profile too often are some other reasons behind people removing friends from Facebook.

While men tend to use Facebook for career/networks and dating, women usually sign up on Facebook to receive coupons, offers and give positive feedback.

Believe it or not, Facebook depression is something true and easy to notice. People with more friends tend to write longer updates, talk less about their families and are less emotional overall. The time of the day usually has a huge influence on how positive or negative the updates are. Between 9 AM and 2PM negative updates rise. At around 6 PM positive updates reach a daytime low. During the afternoon most of the updates are negative still. The statistics reach a scary conclusion: only during the early morning most of the updates are positive. As a matter of fact, positive emotions get lower and negatives get higher as the day passes by.

Half of Facebook’s user database logs in daily and usually comment more on negative updates. Positive updates usually receive less comments.

The users in Australia spend the most time on Facebook per month, around 6 hours and 52 minutes. USA comes in second with 6 hours and 9 minutes, UK is third with two minutes less per month. This is an average of 10 to 14 minutes per day per user.

Almost half of the users between 18 and 34 check their Facebook first thing in the morning, some of them even from their smartphones before getting out of bed. In the US “Facebook” was for the second year in a row in 2011 the most searched word on Google, with 2.11% out of all the searches. “Facebook.com” was also searched by many users, placing fifth in 2010. All Facebook-related searches on Google accounted 3.48% of all the searches in the US in 2010.

But why?

Now that was enough statistics. You can find even more by reading the infographics I included in this article. I am sure some of you still ask yourselves why is Facebook more or less dominating the internet? And while I am not sure I hold the right answer, here is my view on the topic.

I think Facebook is so popular because it is the only web page out there that meets our needs and demands. Whether we like it or not, Facebook helps us communicate more – not better, just more…and quicker. Interacting on Facebook is definitely much easier than calling someone. Moreover, it allows users to only be contacted when they want – if they do not have time for friends, they can just avoid checking Facebook. A person calling you can’t be avoided forever, but a Facebook wall post can be avoided as long as the user wishes to.

The capability of  presenting ourselves as we want to be seen, not as we actually are, is something else that attracts people, especially the younger users. Many teenagers and college students look up to stars and actors and wish to have their lives. On Facebook it is possible. Just get a grip of Photoshop and edit your pictures so that you look younger, more beautiful and basically, perfect – manipulate them so that everybody who will see them (on Facebook obviously) will like and comment. You know you are lying to everybody – that is not the real you, but you still do it. It pleases you. It boosts your ego – and who doesn’t enjoy that?

In a way, Facebook is like Apple – the only difference is that one sells products that cost a huge amount of money, while the other offers you a social media solution for free. But they have something in common: they give users what they demand. You want a simple operating system? There you go, it’s called OS X. You want a nice looking computer, with a minimalist design which has never been seen before? Here you are, it’s called a MacBook. You want a product that will last for a long time if you take care of it? Here it is, we call it iPad. You want a sturdy music player? We have it and we named it iPod Shuffle. And so on. There is a reason behind Apple and Facebook being the most successful companies today.

Facebook does the same as the Cupertino based multinational. You want to be able to interact with people? You have the wall. You want to show pictures of yourself? There you go, this is how you can upload them. You want to have fun? We have Farmville and Zynga Poker. You want to always know what is happening? We call them Pages. You want to be able to have everything at the tips of your fingers? Here you are, Facebook Mobile and apps for every portable device.

Facebook, in its simplicity, solves the user’s needs. And this is what we all look for on Facebook. This is the main reason why we come back. We may like to closely follow our friends, play games, write funny status updates, follow companies’ updates or upload pictures of ourselves – whatever it is, Facebook makes it possible for us. This is the main reason behind Facebook’s world domination. And as long as they continue on this path, there is no way anybody will tear the giant apart, not even bad management.

Dare to think otherwise, why do you think such huge rise of Facebook happened pushing MySpace out of game? I would love to hear your opinion down below, in the comment section.

A bit more for you

69 Written ArticlesWebsite

Christian Vasile is an enthuziastic Romanian web designer currently living in Denmark. He is passionate for the industry and writes about design, usability, coding and freelancing and is a regular publisher here at 1WD. You can follow him on Twitter at @christianvasile or visit his web portfolio by clicking on the link above.

7 Comments Best Comments First
  • Steve Kamn

    Saturday, May 19th, 2012 07:43

    6

    Thanks for the masterpiece. I spend several minutes a day on Facebook, and this is really a useful information for me.

    +1
  • Perjan

    Thursday, May 17th, 2012 08:15

    2

    Great detailed article Christian. By the way, i think this should be called Facebook’s Own Timeline :). As i am a fan of twitter, please can you tell us if you have in plan to make a “twitter timeline”.

    Keep up the good work.

    0
  • P.Muhammed Jafar

    Thursday, May 17th, 2012 09:11

    3

    Hi Vasile,
    This article is both awesome and shocking…
    I am using Facebook, but I am not a FB depressed guy…
    I can live without Facebook, but my every working Day is started with Gmail.
    I am wondered when I was looked at your first Info graph, why because my home country (India) is the first position. I really like the FB’s simplicity, but it has some privacy and security issues. We can say that FB’s closet competitor Google Plus is imitating Facebook.

    0
  • Egzon

    Friday, May 18th, 2012 03:11

    4

    Great article, loved the infographics.

    0
  • Marius

    Thursday, May 17th, 2012 06:46

    1

    Hi Christian,
    I’ll share with you how I perceived Facebook when I first browse to it….In that period of time Hi5 was very popular and a lot of friends had been using HI5. A lot of rubbish stuff was posted on that network and Facebook has been a relief for more serious people. What could be more pleasant, than a network where you need to use your real name and stop posting stupid things either.

    It was a revelation for me and for many others, but very annoying with online games and other stuff with require your agreement and participation.

    Now it has become a marketing tool…very efficient one and now I’m not very addicted to Facebook but I can’t overlook either.

    0
  • Maria Wendt

    Friday, May 18th, 2012 12:40

    5

    Wow, this is a great, very informative, well-thought out article. Everything is screaming quality, from the writing style to the infographics. Thanks so much!

    0
  • Daquan Wright

    Saturday, June 2nd, 2012 18:48

    7

    I must commend you, this article is tremendous in presentation and data gathered through research, good work! I knew FB was a powerful force in the online sphere, but it’s so much bigger than I realized. I also never knew it accounted for so many jobs in various countries.

    -1
  • Daquan Wright

    Saturday, June 2nd, 2012 18:48

    7

    I must commend you, this article is tremendous in presentation and data gathered through research, good work! I knew FB was a powerful force in the online sphere, but it’s so much bigger than I realized. I also never knew it accounted for so many jobs in various countries.

    -1
  • Steve Kamn

    Saturday, May 19th, 2012 07:43

    6

    Thanks for the masterpiece. I spend several minutes a day on Facebook, and this is really a useful information for me.

    +1
  • Maria Wendt

    Friday, May 18th, 2012 12:40

    5

    Wow, this is a great, very informative, well-thought out article. Everything is screaming quality, from the writing style to the infographics. Thanks so much!

    0
  • Egzon

    Friday, May 18th, 2012 03:11

    4

    Great article, loved the infographics.

    0
  • P.Muhammed Jafar

    Thursday, May 17th, 2012 09:11

    3

    Hi Vasile,
    This article is both awesome and shocking…
    I am using Facebook, but I am not a FB depressed guy…
    I can live without Facebook, but my every working Day is started with Gmail.
    I am wondered when I was looked at your first Info graph, why because my home country (India) is the first position. I really like the FB’s simplicity, but it has some privacy and security issues. We can say that FB’s closet competitor Google Plus is imitating Facebook.

    0
  • Perjan

    Thursday, May 17th, 2012 08:15

    2

    Great detailed article Christian. By the way, i think this should be called Facebook’s Own Timeline :). As i am a fan of twitter, please can you tell us if you have in plan to make a “twitter timeline”.

    Keep up the good work.

    0
  • Marius

    Thursday, May 17th, 2012 06:46

    1

    Hi Christian,
    I’ll share with you how I perceived Facebook when I first browse to it….In that period of time Hi5 was very popular and a lot of friends had been using HI5. A lot of rubbish stuff was posted on that network and Facebook has been a relief for more serious people. What could be more pleasant, than a network where you need to use your real name and stop posting stupid things either.

    It was a revelation for me and for many others, but very annoying with online games and other stuff with require your agreement and participation.

    Now it has become a marketing tool…very efficient one and now I’m not very addicted to Facebook but I can’t overlook either.

    0

Comments are closed.

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