Money losing startup Facebook founds non-profit

Jeff Mancuso December 8th, 2009

This is rich. I got an email today from Facebook, a startup company which has taken $714M in funding and is still losing money, letting me know they intend to spend $9.5M found a non-profit that will “that will identify and fund projects and initiatives that promote the cause of online privacy, safety, and security.”

Facebook is sending you this notice of a proposed class action settlement that may affect your legal rights as a Facebook member who may have used the Beacon program. This summary notice is being sent to you by Court Order so that you may understand your rights and remedies before the Court considers final approval of the proposed settlement on February 26, 2010.

This is not an advertisement or attorney solicitation.

This is not a settlement in which class members file claims to receive compensation. Under the proposed settlement, Facebook will terminate the Beacon program. In addition, Facebook will provide $9.5 million to establish an independent non-profit foundation that will identify and fund projects and initiatives that promote the cause of online privacy, safety, and security.

For full details on the settlement and further instructions on what to do to opt out of, object to, or otherwise comment upon the proposed settlement, please go to http://www.BeaconClassSettlement.com.

I’m not approaching this post with anything other than a high-level observation that a money-losing startup with $714M of funding is investing $9.5M to found a non-profit. I find it hilarious.

  • http://dustinblake.com Dustin Blake

    Your point would be salient if this was a voluntary investment, however, the email message clearly states that the ‘investment’ is part of a negotiated legal settlement.

  • http://www.expandrive.com Jeff Mancuso

    Dustin – I certainly appreciate that they were legally compelled to do it. However, that doesn’t completely relieve the story of irony in my opinion :)

  • http://kirigin.com Ivan Kirigin

    Lots of folks at facebook like using expandrive. I’m one of them :-D

    You just sent me a customer service email, and I stumbled upon the blog. The post is inaccurate as facebook has already announced it is cashflow positive.

    “We’re also succeeding at building Facebook in a sustainable way. Earlier this year, we said we expected to be cash flow positive sometime in 2010, and I’m pleased to share that we achieved this milestone last quarter. This is important to us because it sets Facebook up to be a strong independent service for the long term.” http://blog.facebook.com/blog.php?post=136782277130

    [i'm not representing facebook here - just my own views]

  • KRLynn

    On 11/12, you began your post titled “More info on Strongspace v2.0″ with and overdue “First off, I apologize again for the poor communication. You guys deserve much better.” Your concluding comment on 12/01 to the follow-up discussion — mostly comprising pleas for further updates — was a promise that you would post on the subject later that day. I’ve been unable to find it, or any more information on the topic anywhere.

    You might do well to consider taking care of your own business before commenting critically on Facebook’s.

  • http://www.expandrive.com Jeff Mancuso

    KRLynn – please email jmancuso@expandrive.com and I’ll forward on the communication you seem to have missed. We haven’t posted subsequent emails on the blog as they have been specific to account types/etc.

  • http://robreed.net/weblog Rob

    Love this post. Love it. This weblog post is THE reason I’m going to buy ExpanDrive. Irrational you say? I disagree. Both the sentiment and the thinking behind it are exactly what I want in the software I buy. ExpanDrive seemed like a nice utility to me, now I’m more certain that it is.

    The Facebook employee chatter is unfortunately what I would expect. “Lots of folks at facebook like using Expandrive…” So what? Is that a threat of some kind. Is there some sort of obligation to love everything about your customer’s products and business practices? That’s nonsense.

    “We’re also succeeding at building Facebook in a sustainable way…” Unfortunately building Facebook in a sustainable way seems to come at the expense of users privacy. I suppose no one said they were building Facebook the right way. Regardless, I have my doubts that Facebook’s strategies are ultimately sustainable. I guess we’ll see.

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