The increased value of Facebook will double CEO Mark Zuckerberg's estimated $6.9bn fortune. Photograph: Christian Alminana/WireImage.com
Facebook has received a new round of investment that values the social media firm at $50bn (£32.3bn), making it worth more than Time Warner, eBay or Yahoo.
The funds from investment bank Goldman Sachs and its long-time Russian investor Digital Sky Technologies underlines the astonishing growth of the social networking site, started from a Harvard dorm in 2004 by Mark Zuckerberg.
Although it is yet to disclose a profit, the site's popularity has investors lining up for a piece of the action. Goldman Sachs is believed to be setting up a "special purpose network" to allow its rich clients to invest in the firm, whose shares – which can be traded on private stock exchanges – have seen increasingly frenzied trading in recent months.
Last year Facebook beat Google to become the world's most visited website, according to internet analyst Experian Hitwise. It accounted for 8.93% of all US visits between January and November 2010 and now has more than 500 million active users. Half of Facebook's users come to the site at least once a day.
Zuckerberg, who last year became Time magazine's man of the year and saw the release of a hit Hollywood film about his life, The Social Network, stands to become one of the richest people on the planet on the new valuation of the company. He owns around 25% of Facebook, and it is thought that a sale at the new price would double his estimated $6.9bn fortune.
Zuckerberg has brushed off rumours he is preparing to sell shares in the firm through a stock market flotation, telling a conference last year "don't hold your breath", when asked about it. But the new investment will fuel those rumours once more.
Under US law private companies with more than 500 shareholders have to disclose their financial results. The rule in part triggered Google's decision to go public after similar interest from investors. The Securities and Exchange Commission (SEC), the US's top financial watchdog, is already investigating the trading in shares of Facebook and other hot social media firms including Twitter and Zynga, maker of the popular Farmville game.
Facebook does not disclose its financial performance, though analysts estimate the company is profitable and had sales of $2bn last year, double those of 2009.
Colin Gillis, technology analysts at BGC Financial in New York said: "Fifty billion is a big number but right now there is only one Facebook. People pour their private information into Facebook for free, it's an incredible platform for advertisers, and for games, and just look at that traffic.
"We haven't seen anything like this for a very, very long time."
