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$100M for Friendster After All These Years?

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Friendster has managed to survive as an independent company for seven years, but a sale of the social network to a buyer from Asia (where the site has become quite popular, especially in the Philippines) is imminent, according to a report by Reuters. The company is expected to be sold for more than $100 million by the end of the month, which frankly isn’t all that bad of a return after years of technical problems, last-ditch strategies and management changes. I imagine some of the VCs who’ve put $45 million in funding into Friendster since 2002 never expected to see their money back.

Friendster, which says it has 115 million members, has been openly shopping itself around. A potential buyer, according to Reuters, is China’s Tencent. Facebook was also interested but reportedly “was turned down due to competition and intellectual property issues.” One of Friendster’s claims to fame in recent years has been receiving five patents for its early work on social networking. The company has made rumblings about enforcing the patents, but is not currently involved in any lawsuits related to them, according to public records.

4 Responses to “$100M for Friendster After All These Years?”

  1. Oh man, Friendster is a graveyard! $100 million, they should HURRY and take that… about a year ago, most Filipino friendster users discovered FaceBook, and the game is all but over. There are still maybe 50% of the users sitting there, but it is all about critical mass.

    I witnessed this with my wife, who was devout with her friendster account and her Yahoo IM, but gradually saw friends just stop showing up, one by one. She had no interest in moving to FaceBook, she didn’t like the interface, there was no reason to move. Yet pure fact, her friends were gone, led her to FaceBook, and once she finally made the switch, she was elated. They were all there, and those that were uninformed or are die-hards are coming over one by one. It also unified social networking and chat. In the Filipino world, FaceBook has killed both Friendster and Yahoo IM.

    I don’t like to see a monopoly kill independents, but with social networks there is an inevitable force of critical mass. FaceBook is leading, Friendster will have to re-invent itself to survive, whoever buys it.