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Mark Zuckerberg
Facebook CEO and founder Mark Zuckerberg Photograph: Craig Ruttle/AP
Facebook CEO and founder Mark Zuckerberg Photograph: Craig Ruttle/AP

Six year old Facebook heads into uncharted territory

This article is more than 14 years old
By the time Google reached its sixth birthday, it was a public company. Amazon, meanwhile, was turning its first profit. So where does Facebook go from here?

This time in 2004, Mark Zuckerberg was just a kid at Harvard starting to wonder whether his latest project - a little social network called Facebook - would be a success. Now he's sitting on top of a goldmine.

With the world's biggest social net now celebrating its sixth anniversary, Zuckerberg doesn't seem to be letting up: indeed, the company has taken the time to announce that Facebook now has 400m users, that it has forged a new search deal with Microsoft and is rolling out a new tweaked version of the site's constantly shifting homepage.

It's been a dizzying rise - and the past year, in particular, has seen astonishing growth - with an already substantial user base doubling in size and the business edging towards making a profit, too.

Given all of this, it is easy to look at Facebook's rise to prominence and wonder where it's going. Is it the next Google? The next Yahoo? Even the next Microsoft?

In fact, compare Zuckerberg's work to the trajectory of other internet companies, and the answer may not be what you expect.

Facebook's first six years of growth

Comparing Facebook to other companies - even internet companies - is difficult. On the one hand, its closest rivals are businesses like MySpace or Yahoo, which feed off people's social activity. On the other, it seems to have a lot in common with the algorithmic, engineering approach to information that Google takes. Then again, it also has a lot in common with something like AOL, in that it brought a community of relatively inexperienced internet users together for the first time.

Looking at Facebook's growth shows exactly what's going on: continuous, explosive expansion seems to be speeding up, and even if it begins to level off - which, given that it already covers around a quarter of everybody on the planet that is online, seems likely - it is still substantial.

So how do we model Facebook's development?

Its closest rival, MySpace, is no use - under a year older than Facebook, it sold to Rupert Murdoch while still in its infancy. Looking at big web companies like Yahoo or eBay doesn't seem to help, as they pushed themselves to exaggerated sizes on the back of the dotcom boom.

Given Facebook's strategy of heavy spending for many years in order to build up market share, it appears to have taken a page out of Amazon's book. It took Jeff Bezos and friends six years to become profitable - a similar timescale to Facebook - but crucially, the company had already gone public in 1997, less than two years after it first launched.

Even Google, the model that most entrepreneurs want to follow, had turned into a massively profitable business inside six years. By the time it was Facebook's age, the company was launching on the stock market.

So what does Facebook do? Even in the big-spend, long-burn model, it would be considering launching publicly soon. But yet it has reiterated at various points that it does not want to. Ultimately, however, that is the only way that its investors are going to recoup the enormous sums they have sunk into the company.

Of course, these are not exactly apples-to-apples comparisons. Yahoo and Amazon were born on the cusp of the first dotcom boom and rode through on that wave; Google had changed the advertising business fundamentally by the time it matured; AOL was already venerable by the time they helped steer the revolution. Facebook, meanwhile, has had to deal with a general stock market malaise and an IPO climate suppressed by new regulation.

But if looking at Facebook in this way shows us anything, it is that the site - as it turns six years old - is heading somewhere that nobody else has been before.

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