The details: Facebook spent $68 million on acquisitions last year

Facebook revealed that it spent $68 million in cash and stock on acquisitions last year, according to its filing for an initial public offering. The company said all of the deals were not material.

Here’s more details on how much Facebook has paid for companies in stock. This excludes cash-based compensation and other retention bonuses. We don’t know which companies Facebook is actually referring to in its filing because the company doesn’t explicitly say, but we put our best guesses here based on when deal announcements were made.

The numbers seem mostly consistent with what we’ve heard — that the amount of equity Facebook offers for talent has gotten smaller over time as secondary markets have more aggressively priced the value of Facebook’s shares. Facebook now tends to offer Class A shares instead of Class B shares. (Class A shares have one-tenth the voting power of Class B shares.)

Companies that are closely connected to Facebook’s founders or early employees, like Drop.io, also seem to get far better terms than other startups do. That said, Facebook has told us that it is starting to look at bigger deals and raising $5 billion in capital might be just the kick that the company needs to go for more than talent.

In Facebook’s most recent internal valuation on December 31, the value of a Class B share was found to be $29.73. A single Class B share can be converted into a Class A share. We calculated the current value of each deal based on the number of shares multiplied by the December 31 valuation.

  • “On August 14, 2009, we issued 11,052,955 shares of our Class B common stock as consideration to ten individuals and one entity in connection with our acquisition of all the outstanding shares of a company.” This might be FriendFeed, which Facebook reportedly acquired for $50 million. Co-founder Bret Taylor later went on to be chief technology officer. Current value: $328,604,352
  • “On May 18, 2010, we issued 3,625,000 shares of our Class B common stock as consideration to a company in connection with our purchase of patents from the company.” This might be the deal to buy the Friendster patents. Current value: $107,771,250
  • “On June 16, 2010, we issued 238,000 shares of our Class B common stock as consideration to a company in connection with our purchase of certain assets from the company.” Unclear. It could be Nextstop, whose co-founder Carl Sjogreen is now a director of product management at FacebookCurrent value: $7,075,740
  • “On July 7, 2010, we issued 590,900 shares of our Class B common stock as consideration to a company in connection with our purchase of certain assets from the company.” Again. Unclear. Could be Nextstop or Hot Potato. Or the higher price could be for Chai Labs, whose co-founder Gokul Rajaram is now leading the charge on advertising. He was nicknamed the Godfather of Adsense. Current value: $17,567,457
  • “On August 18, 2010, we issued 289,350 shares of our Class B common stock as consideration to two individuals in connection with our acquisition of all the outstanding shares of a company.” Could be Hot Potato, which was founded by Justin Shaffer, who later worked on Groups and Places. Current value: $8,602,375
  • “On October 29, 2010, we issued 1,309,284 shares of our Class B common stock as consideration to a company in connection with our purchase of certain assets from the company.” Probably Drop.io, which saw its chief executive and longtime friend of Mark Zuckerberg, Sam Lessin start at Facebook. He headed up the Timeline overhaul. Current value: $38,925,013
  • “On November 12, 2010, we issued 350,000 shares of our Class B common stock as consideration to a company in connection with our purchase of certain assets from the company.” This might be for Walletin, whose co-founder Cory Ondrejka was a chief technology officer at Linden Lab. He’s now leading the charge on building a robust HTML5 platform that will lead Facebook beyond the app era largely ruled by Apple. Current value: $10,405,500
  • “On December 15, 2010, we issued 1,030,000 shares of our Class B common stock as consideration to two individuals in connection with our acquisition of all the outstanding shares of a company.” This could be for Rel8tion, which was a mobile advertising startup. Current value: $30,621,900
  • “On February 28, 2011, we issued 681,357 shares of our Class A common stock as consideration to a company in connection with our purchase of certain assets from the company.” This might be for Beluga, the group messaging startup founded by former Google product managers that is now powering Facebook’s standalone app Messenger. Current value: $20,256,744
  • “On April 5, 2011, we issued 1,659,430 shares of our Class A common stock as consideration to 13 individuals and six entities in connection with our acquisition of all the outstanding shares of a company.” This could have also been for Snaptu, given the high individual count on this deal. Snaptu was said to be one of Facebook’s more expensive acquisitions. It gave a boost to the company’s ability to build apps for the long-tail of feature phones, which Facebook is relying on to fuel its next era of growth in emerging markets. Current value: $49,334,854
  • “On August 1, 2011, we issued 75,426 shares of our Class A common stock as consideration to three individuals in connection with our acquisition of all the outstanding shares of a company.” This could be for Push Pop Press, which had some talented designers from Apple. Or it could be Friend.ly, whose team is now working on growth. Or it could have been for Daytum, the company co-founded by Nicholas Feltron, who famously turned his life into a rich infographic. He played a very prominent role at the last f8 when the company rolled out Timeline. Current value: $2,242,414
  • “On October 7, 2011, we issued 360,883 shares of our Class A common stock as consideration to 21 individuals and eight entities in connection with our acquisition of all the outstanding shares of a company.” This could be the Gowalla acquisition. The number of participants here seems to be a proxy for the many investors that were in on the location-sharing mobile app. Current value: $10,729,051
  • “On October 10, 2011, we issued 183,750 shares of our Class B common stock as consideration to a company for a license of certain technology from the company.” It could be Strobe, which makes a platform supporting mobile web apps that can work on multiple devices and operating systems like iOS and Android. Current value: $5,462,887
  • “On January 3, 2012, we issued 90,000 shares of our Class A common stock as consideration to four individuals and 13 entities in connection with our purchase of certain assets from a company.” Unknown. Current value: $2,675,700
  • “On February 1, 2012, we issued 212,250 shares of our Class A common stock as partial consideration to two entities in connection with our purchase of certain assets from a company.” Unknown. Current value: $6,310,193

Facebook’s platform paid out $1.4 billion to developers in 2011 — less than what Apple did

Facebook said it paid out $1.4 billion to developers through payments on its platform in 2011. Apple paid out half that much to iPhone, iPod and iPad developers last quarter.

Apple said it paid $700 million to iOS developers in the holiday quarter during its earnings call last week. While we can’t be exactly sure of how much it paid in all of 2011, the company did say last week that it had paid out $4 billion over the lifetime of the app store, up from the $2 billion cumulative figure it shared less than a year earlier during March’s iPad 2 launch. While the dates of these milestones are probably slightly off, it suggests that Apple paid more than $2 billion to developers last year.

The other thing to consider is that Facebook only made Credits mandatory for canvas games in July, so Facebook’s numbers for the first half of the year don’t reflect the full earnings power of the platform. Since Facebook earned $188 million in payments revenue last quarter, that implies that it paid around $438 million out to developers in the holiday quarter based on its 30 percent revenue share. That’s about 62 percent of what Apple paid developers in the fourth quarter.

What this all means is that Apple’s iOS platform outperforms Facebook on a per-user basis for developers. Consider that Facebook has 845 million monthly active users while Apple has sold 315 million iOS devices (which doesn’t account for users who have more than one iOS device or who upgraded to newer iPhone or iPads). Since the “barrier to entry” to iOS is buying an actual device while joining Facebook is free, we’d naturally expect Apple’s platform to attract a more lucrative demographic.

We know that we’re comparing apples to oranges here (literally). But for developers deciding which platforms to build upon, these trade-offs are very real. Developing an app for Facebook might mean spending fewer resources on smartphone apps. So comparing potential payouts helps developers understand where to wisely invest their time and talent.

Zuckerberg will take a $1 annual salary starting next year

Mark Zuckerberg will take a $1 annual salary starting next year, mirroring other iconic public company founders like Apple’s founder Steve Jobs and Google co-founders Sergey Brin and Larry Page.

Zuckerberg’s total compensation last year was $1.49 million off a base salary of $483,333. Chief operating officer Sheryl Sandberg pulled in $30.9 million, most of which was in stock awards. Mike Schroepfer, who is known internally as “Schrep” and came to the company from Mozilla, pulled in $24.7 million — again, mostly in equity compensation. After that is chief financial officer David Ebersman, who earned $18.7 million and then Facebook’s general counsel Ted Ullyot, who earned $6.96 million.

Facebook board members, including Netscape founder Marc Andreessen, earned $16,667 for serving. Reed Hastings and Erskine Bowles, who just joined Facebook’s board this year were both given around $600,000 in stock-based compensation for coming on-board. We have a more thorough breakdown of the investor table here.

Here’s how Facebook’s ownership splits between Zuckerberg and other early investors

Here’s the sheet with the breakdown of early investors:

Mark Zuckerberg manages to hold onto 28.4 percent of Class B shares, which have 10 times the voting power of Class A shares. Facebook said in its filing today that it plans to sell up to $5 billion worth of Class A shares. Remember that Facebook has a dual-stock structure like Google, which enables the company’s directors and Zuckerberg to have more power over the long-term direction of the company without feeling short-term pressures from shareholders.

Facebook’s first venture investor Accel Partners and its representative on the company’s board Jim Breyer hold onto 11.4 percent of the Class B shares. Coming in after that is co-founder Dustin Moskovitz, who holds 7.6 percent of Class B shares. After that is DST, the Russian late-stage investment firm run by Yuri Milner, which holds 5.4 percent. Following that is Peter Thiel, who was the company’s first angel investor, with 2.5 percent. The remaining directors and investors each hold less than 1 percent of the company.

Facebook Focuses on Speed For Its Latest Android App Update

In trying to bring its iOS and Android experiences to parity, Facebook is overhauling its smartphone app on Google’s platform today by bringing the left-hand menu design it introduced to the iOS app two months ago. Instead of the grid-based design, where users have to return to the main menu to switch between features like photos and the news feed, a menu will sweep in on the left-hand side containing quick links to events, messages, photos and more. Messages are now in the top bar for quick access.

Facebook also doubled the speed for accessing photos and alum in the app. They made it faster to share photos, view comments and edit captions.

Timeline, which Facebook is only now starting to roll out to users in New Zealand, is nowhere to be seen in this mobile app nor on iOS.

The company needs to be better at updating its Android and iOS apps simultaneously — especially because Facebook for Android is poised to become the company’s largest smartphone client over the next year. With 83.2 million monthly active users, Facebook for Android is inching closer to overtaking Facebook for iOS’s 98.3 million monthly actives. The Android app will probably pass iOS in users sometime next year as the market base of Google’s platform nears parity with Apple’s.

Over the past year, Facebook has developed a complex mix of HTML5 and native development to cater to multiple mobile platforms and the long-tail of feature phones. Called Faceweb, it allows the company to maintain one consistent news feed experience across the desktop and mobile devices. At the beginning of the year, the company’s chief technology officer Bret Taylor said Facebook originally had to update seven different versions of the service across mobile platforms and the desktop web until it switched to the Faceweb approach.

Recognizing that its future will be on phones and tablets with 350 million monthly mobile actives already, Facebook overhauled the way it promotes its suite of apps on the homepage this morning.

Gowalla Confirms That Its Team is Going to Facebook as Product, Technology Are Left Behind

Gowalla confirmed that its co-founders plus other key team members are moving west to work at Facebook on product and engineering. Facebook did not acquire the Gowalla product or the technology behind it and did not disclose how many Gowalla employees will be joining the company.

This looks like a classic talent acquisition where Facebook picks up a handful of product managers, designers and engineers and shuts down the startup’s original products. CNN reported on Friday that the Gowalla team was being hired to work on Timeline. However, Facebook did not say what product they would be transitioned to working on. It’s sometimes the case that the people who Facebook acquires work on products that are very different from what their startups were centered upon.

As we said on Friday, Gowalla reportedly had a $28.4 million post-money valuation after its most recent round of funding. It’s doubtful, although not certain, that the price was higher than that, since this was a team — and not product — acquisition.

The Austin-based company launched as a location-sharing service back in 2009 but never got the same sort of traction that New York-based rival Foursquare saw. Today, we can see that the Gowalla app has 10,000 daily active users connected to Facebook against Foursquare’s 560,000 daily actives. Facebook also has its location product Places, which it changed a few months ago to scrap the check-in feed from its mobile platform. Instead, Facebook users must add a city location or tag a specific Place in their Wall or Timeline posts.

Gowalla pivoted earlier this year too, changing its check in-centric app to one that is like a crowdsourced local and travel guide.

Here’s Facebook’s statement:

We’re excited to confirm that Gowalla co-founders Josh Williams and Scott Raymond, along with other members of the Gowalla team, are moving to Facebook in January to join our design and engineering teams. In talking with the Gowalla team, we realized that we share many of the same goals: building great products that reach millions of people, making a big impact quickly, and creating new ways for people to connect and share what’s going on in their lives. While Facebook isn’t acquiring the Gowalla service or technology, we’re sure that the inspiration behind Gowalla will make its way into Facebook over time.

Here’s Gowalla’s co-founder’s statement published in the company blog today:

Three years ago Gowalla’s journey began when I took a photograph of Lake Tahoe on my iPhone. I had just finished a phone call with my dad, and I wanted nothing more than to share that photo and place with him. Not just in a text message or status update sort of way, but with a bit of weight that said “I wish you were here” and “this moment and place are meaningful to me.”
 
We created Gowalla to inspire people to go out and share those places, photos and stories. The past three years have been quite the journey, oft-times in a very literal sense!
 
The Gowalla Passport has become a record of all the places we’ve visited, the people we were with, the photos we took, and the stories we told. Many of you even use Gowalla like a scrapbook of sorts — a place to keep all those memories.
 
About two months ago, my co-founder Scott and I attended F8. We were blown away by Facebook’s new developments. A few weeks later Facebook called, and it became clear that the way for our team to have the biggest impact was to work together. So we’re excited to announce that we’ll be making the journey to California to join Facebook!
 
Gowalla, as a service, will be winding down at the end of January. We plan to provide an easy way to export your Passport data, your Stamp and Pin data (along with your legacy Item data), and your photos as well. Facebook is not acquiring Gowalla’s user data.
 
We know how much many of you loved Gowalla. It’s been the highlight of our lives as we’ve built it with your help over the past two years. As we move forward, we hope some of the inspiration behind Gowalla — a fun and beautiful way to share your journey on the go — will live on at Facebook.
 
We’re so very grateful for the support of our community, our investors, our families, and, of course, the City of Austin as well. You’ve all played a special role in seeing us to this day.

Buffy, Facebook’s Attempt at a Phone, Has Been a “Train Wreck”

Reports of a mythical Facebook Phone have surfaced over the past two years without a real device ever in sight.

Now AllThingsD is the latest to rekindle rumors of such a phone. Liz Gannes and Ina Fried reported yesterday that Facebook has picked HTC to build an Android-based phone emphasizing HTML5 for shipment in 12 to 18 months. The company’s chief technology officer Bret Taylor is overseeing the project, they report.

But the project itself has had a long and troubled history internally at Facebook, say sources with knowledge of it. Originally a skunkworks project that was kept secret from employees for months, Buffy is indeed the codename for the Facebook phone.

Sources tell us that Buffy has been a “train wreck,” and was one of the many reasons that Facebook vice president Chamath Palihapitiya, who used to oversee the project, left the company. Several of the other people Gannes said worked on the project like designer Matt Cahill and Joe Hewitt have also moved on from the company, after spending around four years or more there and vesting. Gannes is now saying that Buffy has been reborn as a more conservative project — an HTML5-centric phone based on Android instead of a wholly integrated device with proprietary hardware and software.

But one of the many problems with forking Android, which means building on a competitor’s open-source code base, is that a Facebook phone would always be at least one version behind the latest technology. That’s fine for Amazon, which is trying to master a narrow use case — primarily reading, with some video consumption and light gameplay — at a lower price point.

A Facebook phone’s social features would need to be so compelling that the device would stand out against the very latest Android phones, on which people can already download the standalone Facebook app. On top of that, there are always risks that Google could change its APIs, codebase or implement policies to make life difficult for Facebook, just as Facebook has always done for certain developers on its platform.

That’s not to mention that Fried’s suggested 12 to 18-month timetable before shipping would put a Facebook phone very much behind the curve. That would be 2 1/2 years behind Microsoft’s launch of Windows Phone 7 and a year and half behind Amazon’s Kindle Fire.

So why are they still working on it? “Internally? They don’t know what to do,” says another source with knowledge of the project.

The reality is that Facebook is in a difficult position with respect to mobile.

The company has the fortune and misfortune of being born in 2004, when it was young and nimble enough to leverage social networking into a powerful grip on the desktop web. But it was too young to influence what has now become a two-horse race between Android and iOS. Just a year after Mark Zuckerberg launched the social network out of his Harvard dorm room, the iPhone project had already begun at Apple and Google had acquired the company that would become Android.

Facebook is now operating in a world where it has the killer app with more than 350 million monthly actives on the mobile web, iOS, Android and feature phones. But it doesn’t have much wiggle room to expand that into something bigger that could contribute revenues to the company’s bottom line over the long-term.

Trying to build a platform on a rival’s platform is hard. Apple and Google are too savvy to allow a third-party like Facebook to become powerful on their own platforms. Both platforms also have rules around payments, making it difficult for Facebook to extend its 30 percent tax through Credits to smartphones.

To do it, Facebook is trying to get around Apple and Google in two ways: HTML5 and an Android-based phone with compelling social features. But both will only start to pay dividends much later.

An Android-based phone is problematic for the reasons listed above.

HTML5, while promising, is too immature to give Facebook traction in the near-term. Last month, Facebook quietly launched an HTML5 platform for the mobile web plus viral channels for native iOS apps. But many top mobile developers, who are in that sweet spot of $1 to $5 million in revenue per month on iOS and Android, told us they frankly weren’t interested in diverting scarce development resources into building HTML5 versions of their games until they saw more traction. Only the most loyal of developers like Zynga, Wooga and Storm8 (which was co-founded by Facebook alums) were launch partners. That’s not to say this isn’t the right long-term choice. It probably is, but it will just take a very long time.

Facebook has also internally reshuffled mobile executives in the last few months. In addition to reportedly moving Taylor onto managing the phone project, Vaughan Smith, who handled acquisitions and corporate development, now also oversees mobile partnerships. Emily White, who oversaw the company’s Groupon competitor Deals until it was discontinued in August, also added mobile partnerships to her responsibilities. Henri Moissinac, who came to the company from eBay like Smith, is said to be no longer working on mobile business development.

Buffy “was an interesting story six months ago,” says the source. “But it isn’t anymore.”

This story originally appeared on our sister site, Inside Mobile Apps.

Facebook Picks Up Veterans of Second Life-Maker Linden Lab in Talent Acquisition of MailRank

Facebook picks up two veterans of Second Life-maker Linden Lab today in announcing a talent acquisition of MailRank today. Given the background of MailRank’s co-founders, we would bet that Facebook’s director of engineering Cory Ondrejka, who was Linden Lab’s chief technology officer, had a hand in sourcing or facilitating this deal. (He also was acquired in to help lead Facebook’s HTML5 efforts last fall.)

With the acquisition, Facebook gets two former directors of engineering at Linden Lab: Bethanye McKinney Blount and Bryan O’Sullivan. We don’t have any details about what the pair will be working on at Facebook.

Before starting MailRank, Blount was a vice president of software engineering at EMI Music. Her co-founder and chief technology officer O’Sullivan was also an engineering director at Linden Lab and also has been a visiting lecturer at Stanford University on Haskell.

He specializes in functional programming and scalable systems and built several open-source libraries including aeson (which is JSON for Haskell) and pronk, which is a framework for load testing web services.

MailRank announced the acquisition on its blog:

We’re thrilled to announce that MailRank’s co-founders will be joining Facebook in December!

We started MailRank to focus on the email that matters, combining powerful technology with a simple interface. It’s been rewarding to build a solution to problems people face every day. At Facebook, we’ll be working with a first-class team on our favorite types of technology problems while supporting a great product people use every day.

We’ll be discontinuing the private beta of MailRank for Outlook to focus on our new jobs. Bryan has posted information about MailRank’s open source technologies on our engineering blog.

The past year has been a wonderful journey, and we thank everyone who has helped and supported us along the way: our test users, investors, advisors, friends, and families. You have our sincerest gratitude.

Now off to a new adventure!

~~ The MailRank Team

Facebook Picks Up Talent Behind SproutCore With HTML5-Focused Strobe Acquisition

Facebook has announced a second mobile talent acquisition in two days as the company bought Strobe, the maker of a platform supporting mobile web apps that can work on multiple devices and operating systems like iOS and Android.

The company’s founder Charles Jolley was behind Sproutcore, an open source Javascript framework that lets developers create web-based applications that resemble native desktop experiences. He also designed the architecture behind MobileMe’s web-based applications at Apple. Facebook said Jolley will join the company’s mobile engineering team.

His company Strobe, which raised $2.5 million from O’Reilly AlphaTech Ventures and Hummer Winblad, lets developers test code for mobile web apps and manage their deployment across multiple platforms from a single interface. It also comes with analytics to track usage.

The deal to buy Strobe plays into a big push this year to get developers building HTML5-based mobile web applications instead of native ones for the iOS or Android platforms, which Facebook doesn’t have as much power to influence.

After several months of anticipation, Facebook launched an HTML5-centric platform last month that enables mobile developers to spread their applications virally — which is something the native iOS and Android app stores aren’t really designed to do because they’re directory-based and curated (especially in Apple’s case.)

>> Read more on Inside Mobile Apps.

Another Mobile Talent Acquisition as Facebook Buys Photo App Maker Digital Staircase

Facebook picked up yet another small startup in what may help efforts to build a full-featured, standalone photo or video app.

The company bought Digital Staircase, the maker of a handful of photo and video editing apps like MovieCam, according to the startup’s blog.

“We’re announcing today that we’re being acquired by Facebook to help bring these mobile innovations to a broader audience. Many things may change, but our dedication to immersive experiences will not,” the company wrote in a statement.

Digital Staircase had a modest amount of success with a handful of paid apps. The company had published five apps to date, although three of them hadn’t seen any updates in two years. Its two most recent releases were MovieCam and MovieCam Go, priced at $2.99 and $1.99 respectively. Those apps seemed to hover in between the #100 and #200 range in the paid apps part of the photography category, indicating it might have been difficult to scale up beyond much of a lifestyle business.

>> Read more on Inside Mobile Apps.

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