The Rise Of Facebook An Amazing Story
For most younger generations, it’s hard to imagine what life would be like without social media―most importantly, Facebook. Billions of people use the social network on a daily basis to do everything from chat, play games, share pictures, post status updates, and (for companies) do a lot of advertising. But where did it all actually begin?
Origins of Facebook
The rise of Facebook wouldn’t have been possible without Mark Zuckerburg. While attending Harvard University for Psychology, Mark Zuckerburg―who was an avid programmer―decided to do a little experimenting one night and created a site called Facemash. Facemash, similar to “Hot or Not”, used the Harvard database to populate student pictures for others to compare who was more physically attractive. Needless to say, that didn’t go over well.
Less than 3 months after created Facemash, Mark registered the domain name thefacebook.com and within a month had created a site similar to another social networking site, Friendster. With the help of 4 of his friends and fellow Harvard attendees, Eduardo Saverin, Chris Hughes, Dustin Moskovitz, and Andrew McCollum, facebook received over 1,000 signups from Harvard students within the first 24 hours. By the end of the first month, over half of the Harvard undergraduate student body were registered members.
Facebook Expands For the First Time
To allow facebook to grow, Zuckerburg decided to expand the site to more universities―in March of 2004 students from Columbia, Yale, and Stanford were allowed to register on the site. This is around the time that Napster co-founder Sean Parker discovered the site and started giving advice.
Within 2 months, thefacebook expanded to every Ivy League campus in the United States and had over 150,000 registered members.
Facebook Receives First Investment
Sean Parker was added as President around the same time and the core group started the company Facebook, Inc. At this time venture capitalist and co-founder of Paypal Peter Thiel made a half-million dollar investment in the company and received 10.2% of the shares in return.
By the end of that year, Facebook had 1,000,000 profiles.
Rapid Growth and Domination
By 2005, Facebook allowed highschool students to sign up to the social network and began its global expansion. Also in 2005, the company decided to change its domain name from “thefacebook” to “Facebook.com”, the name was purchased for $200,000.
By the end of the year 2005, there were students from over 2,000 different universities registered on the site and 25,000 high schools from across the world including the United States, Canada, Mexico, the UK, Australia, Ireland, and New Zealand.
Additional Cash Injections
By the middle of 2006, another round of income was brought in from investors. After a $12,700,000 investment from Accel Partners the year before, another $27,500,000 was borought in from Meritech Capital and Greylock.
Even though tens of millions were invested, a leaked document still stated that there was a multi-million dollar loss in 2006.
During the year, a few offers were also made to buy out the quickly-growing Facebook. One of the attempting buyers was Yahoo who reportedly tried to purchase Facebook in September for $1 billion. In that same month, Facebook opened its doors to anyone that had an email address as long as they were over 13 years old.
Business Pages Start to Grow And Facebook Rises
By the next year, over 100,000 businesses had registered on Facebook as fan pages. Investments continue to come in as Chinese billionaire Li Ka-Shing invested around $60 million and Microsoft purchased slight more than 1.5% of the company for $240 million.
By 2009 the social network giant surpassed Myspace for traffic for the very first time. Since the middle of 2008, Myspace started to decline in traffic while Facebook started to pick up steam culminating in its takeover and acquisition of FriendFeed in 2009.
As business pages and advertising continued to grow, September of 2009 was the first year that Facebook reported a positive income.
Facebook Buys Out Everyone
By 2010 Facebook had half a billion active users and began to take over the web by buying everyone else out. Octazen Solutions, a company startup known for contact-important was bought out by Facebook in February. By April Facebook bought Divvy-shot (the company party responsible for how Facebook pictures are shared today).
By June 2011, Facebook had formed partnerships with other companies including Skype and Pixable and ends up having a company valuation of over $50 billion.
Facebook Goes Public
In 2012 Facebook made a huge purchase of $1 billion to buy out picture sharing company Instagram. One month later, just before Facebook reached 1 billion active users, the initial public offering was released for Facebook and it officially became public. At $38 per share, the company was valuated at nearly $110 billion and became the highest new IPO the world has ever seen.