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Should one invest their money in social networking sites??

Created by : Amrita , Animation/Graphic Artist, Creative design  | 03 28 2011 10:02:46 +0000
Industry : Equity Research/AnalyticsFunctional Area : India(Markets)
Keywords : investment stocks stock market shares indian economy investment in india investing money in facebook investing money in social networking sites
Activity:  604 views;  last activity : 05 27 2011 08:15:01 +0000

Recently when Warren Buffett came to India he warned investors to be careful about which social networks they friend with their investment money.  Buffett, the chief executive of the Berkshire Hathaway investment empire, warned investors Friday at a conference in New Delhi to be wary of social networks such as Facebook and Twitter--a sector that has recently generated great interest and anticipation on Wall Street.

But these are the companies which are doing extremely well and also have a great valuation. So, should one invest their money in social networking sites?? What are your views on this people.....

  
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I think first of all the companies are overpriced and their valuations are very high.....It's extremely difficult to value social-networking-site companies. But then captured the attention of the U.S. Securities and Exchange Commission. The commission is reportedly interested in companies that offer exchanges for privately traded stock and along the way offer a peek at the hypothetical valuations of these otherwise tight-lipped companies. So, one has to wait and watch how these companies perform in the stock market.....
By Amrita , Animation/Graphic Artist, Creative design  03 28 2011 10:17:40 +0000
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Deshpande ji, you may undermine FB and Twitter, but ask the people of Egypt and Arab, these very products ignited the revolution.
By Tanmay Gaur, Freelance Software Developer  | 03 29 2011 18:21:35 +0000
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If you are talking about facebook and twitter alone, you should not fear. The reason is simple, Facebook and Twitter are already business behind businesses. Facebook is already a big on marketing business and twitter is big on news broadcasting. They are here to stay as businesses need both of them for their presence.
By Tanmay Gaur, Freelance Software Developer  | 03 28 2011 12:23:20 +0000
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Why not? Any body can invest in social networking. It depend on any product , content etc. The most important thing is that You have to need analsis by various way, thoroughlly, carefully then you can proceed further. And Risk is evrywhere in any business. Without taking any risk, you cant go ahead, develop, expansion etc. So, any body can invest in social networking and now a days the scenario of social networking is also going high....
By Virag Shah, Confidential  | 03 28 2011 12:15:16 +0000
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I think one can invest in social networking sites provided one studies the content and viewership.
By Suryanarayan Murthy, Asst Vice President (Corporate Finance), A Hydro Power Project  | 03 28 2011 11:01:13 +0000
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Agred that Social media is the next pltform for advertisers but we need to wait and watch the evolvement of this very media.
By Jaygopal Raghavan, Marketing Manager, Landmark Group  | 05 27 2011 08:15:01 +0000
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I think that social network companies has not good future it has less profitabilty in comparision to other companies. less people are awere about tahis type of company.
By KARUNAKAR SHUKLKA, CFA  | 05 07 2011 09:13:29 +0000
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I accept the views Ms.Amrita. also thanks for the referral Mr.Virag Shah. It needs lot of thinking whether to invest in social networking.
By NATTERAJA R. ARIKRISHNAN, GM-Projects, Bentec Electricals & Electronics Pvt. Ltd  | 03 31 2011 17:54:09 +0000
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Tanmayjee, Todays FB or Twitter can be tomorrow's Orkut.... One shouldn't forget that....
By suhaschandra deshpande, Marketing Associate  | 03 29 2011 11:14:44 +0000
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No...Not at all...one should be extremely careful about the performance...
By suhaschandra deshpande, Marketing Associate  | 03 29 2011 11:13:35 +0000
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I Totally agree with Amrita,Its extremely a daunting task to value the stake of social Networking sites & At the same time to invest in S.N.S's may be a good option,but Having an option of free Job-postings sites,Bulk mailing,Free advertisements and many more adds Cherry on the cake,rather than investing on social sites.
By VISHWA DEEPAK MISHRA, HR-Talent Acquisition Cum Business Development Manager, Leading IT Giant.  | 03 29 2011 08:34:30 +0000
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Amrita, Investment itself require a unique strategy. If we are going for long term investment we should avoid some sector if they are over-valued. Media, Securities, companies who are doing trading(export/import) only etc are coming under volatility part of market or known as momentum shares. So every investor invest their money in those scrips for short term period to earn huge profit but not for long term because the factors of these companies can change in short span period of time.....
By Vipin Bhasin, Private Equity/Hedge Fund/VC-Manager, Indian Investment Co.  | 03 28 2011 18:45:52 +0000
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I support your views, Amrita.They should wait & think twice before investing.

Thanks for referral, Amrita.
By SHRIKANT MANOHAR DANKE, Project Manager, Phadnis Infrastructur Ltd  | 03 28 2011 16:42:44 +0000
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u r right

 
By Dinesh Sharma, Pursuing MBA from Amity University Noida  | 03 28 2011 15:39:58 +0000
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i agree with Amrita, in regard to pricing .Otherwise it is good option
By sheriff r mohideen, General Manager -Technical, Origin Foods Limited  | 03 28 2011 15:13:12 +0000
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Besides, the Behavioral pattern of the mass , Just imagine what will happen to your social net-work & subsequently, the Business.

  • Like Egypt, if countries blocked the services including mobile (possibilities are more, Yemen,Jordan, Bahrain, Libya etc.)
  • If there is a Net-work problem occurs frequently( may be hardware / software problem recurring-Twitter & FB had/ has. Also, communication development may not be suitable for the present infrastructure. Mean the Hard & soft ware may go unsuitable for application)
  • If the Site is blocked by the Govt. say,as China did for Google &Gulf for many porno site etc.
By KALIYAMOORTHY , Oil & Gas Area Coordinator, Undisclosed  | 03 28 2011 14:40:29 +0000
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Now with Warren Buffets comments the price should reach actual level in the stock market.  
By Rathin Deb, Freelance Retail Consultant  | 03 28 2011 14:20:40 +0000
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Principally agree with Amrita's argument. But social net working sites are basically for exchange of views and report on matters to common interest. These sites of late have become platform for propagating products, making recommendation. Mr Warren Buffet is great visionary and philanthropist. His investment is only on industries generating capital.For him investment on SNWS is shear wast of money.
By Mohammad Bakhsh, Project Leader/Managing Consultant, Freelancer  | 03 28 2011 12:49:29 +0000
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Mr. Buffet always tell people (investors) to be careful in making investments and doing money transaction. I remember, he always deny about using credit cards. Social networking is powerful but there are lots of hidden things there too! Biggest thing is the huge amount of fake profiles.
By Amit Verma, Unit Head, Neuronimbus Software Services P. Ltd.  | 03 28 2011 10:59:54 +0000
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there are many example of networking sites ultimately in failure path.....so i guess one should be utmost careful before investing in it
By rajesh , MBA/PGDM student, Presidency college of management sciences  | 03 28 2011 10:32:29 +0000
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