Facebook is worth over USD 100 billion, according to analysts who are forecasting the results of the IPO.
I do not find the business model of Facebook to be sustainable. I expect that their value will fall sharply over the next few years. I do not see how they can find a revenue stream that can sustain the high cost of their operations.
Many Internet stocks have high valuation as their shareholders, who are the venture capital funds, have the skill and financial power to support the share price after the IPO for a certain period of time. If the business model is not sustainable, they have abandon the shares. This has happened to Groupon. It will also happen to Facebook, in my view.
I do not find the business model of Facebook to be sustainable. I expect that their value will fall sharply over the next few years. I do not see how they can find a revenue stream that can sustain the high cost of their operations.
Many Internet stocks have high valuation as their shareholders, who are the venture capital funds, have the skill and financial power to support the share price after the IPO for a certain period of time. If the business model is not sustainable, they have abandon the shares. This has happened to Groupon. It will also happen to Facebook, in my view.
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