Yesterday I questioned whether Facebook is near the tipping point, and suggested that they should hurry up and find an exit strategy. Then today a Pali Research analyst suggested that MySpace is generating over $30 million a month in revenues. If that’s the case, maybe Facebook doesn’t need an exit strategy. While Pete Cashmore doesn’t seem surprised, I surely didn’t expect them to make that much money. Although with News Corp’s existing access to television advertisers it makes sense that they could easily monetize their site.
Does this mean Facebook can generate enough revenue to satisfy their existing investors without an exit strategy? Well to satisfy venture capitalists without providing a solid exit strategy, you better pay some pretty serious dividends. Perhaps this is possible though, given that Facebook is expected to generate revenues of over $100 million this year. It would be great if a venture capitalist could provide some insight on this topic. Can a VC backed company satisfy investors via dividends, rather than a quick exit strategy?