NEW YORK — Facebook is getting a $200 million infusion from a Russian Internet investor that values the social networking company at $10 billion even though it has yet to turn a profit.
The investment gives Digital Sky Technologies a nearly 2 percent stake in Palo Alto, Calif.-based Facebook’s preferred stock.
Digital Sky won’t get a board seat.
The $10 billion valuation for Facebook is less than the $15 billion value implied in 2007, when Microsoft spent $240 million for a 1.6 percent stake in the company — even though Facebook has substantially grown since then. However Face book’s own appraisal after the Microsoft deal gave the company a market value of about $3.7 billion, according to details revealed in a legal settlement.
The latest investment, in preferred stock, does not necessarily compare with what the company’s common shares would be worth on the open market. That would be determined if the company were to go public, which is likely a ways off.
During a conference call Tuesday, chief executive Mark Zuckerberg said an IPO is “not something we are rushing toward.” He called the Digital Sky investment a “good cash buffer” to support its growth. Facebook counts 200 million users, 70 percent of them living outside the U.S.
As a private company, Facebook does not disclose financial details. It doesn’t even have a chief financial officer. Gideon Yu left that post in March, and Facebook says it is still searching for a replacement.
EMarketer estimates that Face book’s worldwide ad revenue will be $300 million this year, up 20 percent from last year.
In other words, to hit 70 percent growth, Facebook might have to ramp up the sale of products or services on the site. The company has experimented with some ideas, such as letting users send each other tiny virtual “gifts” for $1 each.
Yuri Milner, Digital Sky’s chief executive, said he is “confident that Facebook has the potential to be one of the most valuable Internet companies globally.”
