Recently, there has been an explosion of web 2.0 companies on the Internet. Many have transformed the way we share information across the web. Although many of these programs are free for the user, they are arguably some of the most valuable companies today. Facebook is set to go public shortly and is rumored to have around a $100 billion valuation.
To put that into perspective, Facebook would be worth more than Bank of America, McDonald’s, double the size of Ford and roughly 10 times the size of Campbell’s Soup. Facebook is the second-most viewed site on the web, slightly behind Google. However, the companies mentioned above are some of the most iconic brands in history, with decades of experience behind them. What are some of the major web 2.0 players and what price tags are investors giving these companies?
YouTube is a household name when it comes to video sharing sites. With approximately 800 million unique visitors and over 3 billion hours of video watched monthly, YouTube has blossomed into the third most-viewed website in the world, according to Alexa.com. Purchased by Google in 2006 for $1.65 billion, YouTube is a cash cow, with revenues around $825 million in 2010. YouTube was one of the first web 2.0 companies to carry such a high valuation and has become a sort of role model for web 2.0 startups.
These games do not require you to spend hundreds of dollars on the console and additional money to purchase games. The games are free, but Zynga makes money through advertisements and virtual goods sold in the games. Although Zynga has turned a profit, in 2011 Zynga had negative net income of about $404 million, with revenue over $1.1 billion. On Dec. 16, 2011, Zynga shares hit the trading floors with investors praising the company with a $7 billion valuation, giving Zynga a higher market capitalization than Electronic Arts, which sells tangible games as opposed to virtual goods.