Social Media Infographic - How much are these companies worth?

Here is a great infographic which displays just how hot the tech bubble is right now. As you can see from below, Twitter has the highest current revenue-valuation ratio which is one remarkable feat. Facebook is scheduled to go public in the next 12 months.

With this, I have one question and it’s the same one that is on the infographic. Are investors buying potential or are they strictly buying users? I personally believe they are buying potential. Without potential and more importantly, without functionality you won’t get users as people want to be able to use things that will help them, it’s the basics of business - identify a need and solve a problem.

Facebook identifies a need (great for keeping in touch with friends/family especially whilst travelling!), Twitter identifies a need (it’s a micro blogging platform - I love Twitter and I find it’s incredible for finding people in your industry, connecting with them and sharing thoughts and ideas and it’s superb for breaking news), LinkedIn identifies a need in that it’s a social network for business professionals and it’s also an extremely popular recruitment tool by HR professionals worldwide. Recruiters use it heavily to find what they call “passive candidates” who are open to new opportunities but not actively looking.

The point to take away from this is that without a good product, you won’t have users so of course they are buying for the potential of the product because just like AOL discovered with Bebo, users can come and go very quickly when the next best thing comes along.

Check out the infographic and leave your comments below.

Social Media TechBubble Infographic

Social Media TechBubble Infographic

Aindreas Phelan works in the Search and Analytics team in metrocafe311 and is a Google AdWords Professional and Google Analytics Qualified.

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