Much has been discussed on whether the $15 billion valuation of Facebook is valid. A quick online search show many have opinions. Some say $15 billion isn’t enough, some it’s worth every penny and many say it’s outlandish.
Rather than join the bigger debate, Rob and I decided to analyze what does this valuation mean to the users. It’s the user growth, “stickiness” (hate that overused word) and of course the application platform that makes Facebook so attractive. We debated what would each user be worth if the $15 billion valuation was valid. Since all users aren’t created equally, we pondered what would each user be worth if we assigned values to their activity levels. Out of those discussions came our second Facebook app, “How Much Am I Worth?”
Here’s an example, I have 100 friends, my sister (who’s in college) has over 1,10o. I have 13 photos and she has 950. Needless to say, Facebook wants more users at her level of addiction activity than me and therefore, she is “worth” more. How much more? Well, that amount is a moving target. We’ve created a formula that assigns weights to each activity such as photos, groups, friends, wall posts, etc. As more people add the app with higher levels of activity, the average and therefore each user’s value adjusts. Read more about our formula from Rob’s post.
So, our app shows you a calculation on how much I’m worth to Facebook… big deal, right? Well, here are a few reasons why the app matters and why you should add it.
1- Our society loves to compare. Do you know the make or model of your neighbor’s or co-workers’ car? You probably do, as our society loves to “keep up with the Joneses.” At it’s core, our app allows you to compare your worth with others.
2- The true appeal is competing. What else do we like to do? Win! How do you win? By beating out your friends and the users with the next closest value (a girl from Virginia Mary). Of course, I’d like to “beat” my sister, but I’m not even close, so my short-term sights are on Mary. Fair warning to Mary, I’m adding photos, friends and notes… Game on!
3- Your value isn’t final. Unlike your 7th grade geometry grade, you can alter your worth. My value fluctuates daily. People find enjoyment on being able to control (at some level) their own success.
4- Facebook needs each of us to be more involved. I suspect most Facebook users care little about the valuation, but they yearn for more ways to interact with their friends through new tools. The jury is still wayyy out on the future value of this exploding network, but as VC blogger, Matt Winn said in his post, “..every profile does actually hold value. And its value is generated in an extremely scalable way, by users.”
5- Ohh, the placed we’ll go. Our app is less than a week old and we’re already working on phase 2. Maybe you can’t be the have the highest worth, but you might in your hometown, college, company or demographic area. The comparison options are countless as are the reasons to keep coming back to check on your worth.
So, go add the application and let me know how much you are worth. Your last name may not be Jones, but we all love to win.
Update: Thanks to Nick from All Facebook for the review.
