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Facebook success generates a large collection of startups

Facebook has long considered itself a platform not a mere website. It positions itself as an Internet device where users can interact with content and other users. It is more than a destination, it is a series of tools that users can tap to boost communications. That is why its architecture enables and encourages developers to build a wide array of tools that can access the platform’s features. This is a great concept and its positioning definitely takes Facebook several notches higher and far away from websites that are merely popular. As we have seen in the case of Myspace, Digg, and Friendster initial wild popularity can only take you so far before you decline. Internet users, after all, are quite fickle. Facebook’s platform configuration and positioning future proofs it from the decline many one-trick pony type sites chronically suffer or will suffer from. While Mark Zuckerberg and crew probably thought of their platform ecosystem primarily for enabling and processing third party and developer content, their system also spawned something else-a whole network of businesses that generate income from the Facebook environment. Facebook has spawned a whole ecosystem of startup businesses.

Of course, the biggest example of these spawned Facebook environment-incubated companies is Zynga which launched an IPO fairly recently. Assuming current favorable IPO market developments persist, it appears that several other startups may not be too far behind Zynga in terms of IPO development. The list of potential Facebook-spawned IPOs is quite long. However, a few do stand out. For example, the social network interest filtered buy and sell service, Payment. Merchants use Payvment to locate customers based on specific interests. Considering how many users Facebook has, Payvment offers a huge and finely segmentable market for merchants who focus on niche markets. Indeed, the service attracts merchants that target markets that might not be supported by a brick and mortar retail store model. Payment is so targeted and effective that it alone accounts for close to 80 percent of the shopping done by users in Facebook. Another great example is BranchOut. It is a job networking service based in Facebook and is looking to surpass 13 million members. It is a facebook only application and is rapidly growing. It is on track to exceed the number of LinkedIn, another social job networking company that already went IPO, soon. All told, Facebook’s platform supports 18 times more jobs than the number of jobs at Facebook. Now, that is a huge economic footprint and will only continue to grow even larger as the company continues to grow.

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