In 2005 Kyle MacDonald made a series of fourteen trades, beginning with a red paperclip and ending with a house. It took him less than a year. You all know the story. The Office did even an episode this year about the idea as well.
Well, Malaysia’s MOL Global now has somewhere around over $100 million in Facebook stock at the current secondary market valuation of around $31 per share. Until now, no one except insiders even knew they had any Facebook stock at all.
But they do, and here’s how they got it, and it reminds me a lot of the Red Paperclip.
MOL Global bought Friendster, you may recall, in late 2009. They paid $39.5 million for the company, but with adjustments for things like Friendster’s cash in the bank it was actually somewhat less.
Then, in July 2010 Friendster entered into a big partnership with Facebook. Later it became clear that MOL had sold Friendster’s portfolio of 20+ social networking patents and patent applications to Facebook. The reports at the time said MOL got around $40 million for those patents. That $40 million was in cash, advertising credits and the payments deal reported in July according to articles written in August of last year.
That was actually incorrect, we’ve heard from multiple sources.
In addition to other deal consideration, MOL also received 700,000 shares of Facebook stock in the middle of 2010 as part of that deal. And now, nearly a year of crazy growth and a 5-for-1 stock split later, those 700,000 shares have turned into 3.5 million shares. And those 3.5 million shares are worth around $109 million at the current secondary market Facebook stock price that values the company at $70 billion.
Meanwhile Friendster is still around, although parts of it are being shut down and MOL is focusing on relaunching it in Asia.
Not a bad outcome for Friendster in the end. It’s just too bad that none of the original investors or employees got a piece of the Facebook shares. Fortes fortuna adiuvat and all that. MOL crushed it, and the Friendster investors broke ranks too soon. If only they could have held out a few months more, Facebook would have come calling.
MOL Global is one of South East Asia’s biggest internet companies and owns 100% of both payment service provider, MOL AccessPortal Sdn Bhd (MOL) and the world’s pioneer social network, Friendster Inc. (Friendster). MOL has been operating and developing payment systems since 2000. MOL handles over 60 million transactions annually with an annual payment volume of over USD300 million. MOL leverages on a network of more than 600,000 physical and online payment channels. MOL is linked to 88 online banks...
Facebook is the world’s largest social network, with over 1.1 billion monthly active users. Facebook was founded by Mark Zuckerberg in February 2004, initially as an exclusive network for Harvard students. It was a huge hit: in 2 weeks, half of the schools in the Boston area began demanding a Facebook network. Zuckerberg immediately recruited his friends Dustin Moskovitz, Chris Hughes, and Eduardo Saverin to help build Facebook, and within four months, Facebook added 30 more college networks. The original...
Friendster launched in 2002 as one of the first social networking sites. The service allowed users to communicate with other members, share online content and media, discover new events, brands, and hobbies. The site, at its peak, reached tens of millions of registered users; however, it has since lost its popularity. Friendster was acquired by MOL Global in December 2009 for $26.4 million. In May 2011, Friendster repositioned itself into a social gaming site, discontinuing support for existing users’ social...
Seattle, WA
San Diego, CA
Menlo Park, CA
San Francisco
San Francisco, CA
Berlin, Germany
