Bloomberg announced today that Tiger Global, a global hedge fund, agreed to by an approx. 1% stake in Linked-In, a professional networking site, for $20 million, valuing the webiste at more than $2 billion. In 2007, Microsoft paid $240 million for a stake at Facebook, valuing the site at $15 billion. In 2005, News Corp, the media giant owned by billionaire Rupert Murdech, paid $580 million to acquire myspace.com, a major social networking website.

This is the value that multinational corporations are placing on social networking. Why are they paying this much? Is it just for the advertisement exposure? Or is it more?

Tags: Facebook, Linked In', myspace, networking, socail network websites

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