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Facebook Valuation in Second Market to Decline in Next Auction – Google Plus to Blame

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The day Goldman Sachs invested about 1.5 billion dollars in Facebook, we concluded that Facebook has reached its peak. In Further mathematics, that was their maximum point. To have any change in momentum, they have to lose value. Do not be deceived, Myspace lost not because of Facebook but because they destroyed themselves.

 

Late last year, a single share of Facebook was at $28.26 in Second Market, valuing it at more than $70 billion. By January, it lost about $2 to become $26.25 per share and then recovered to $27. From Tekedia Intelligence data, the $28.26 was the highest it has attained in its auction.

 

SecondMarket is the marketplace for alternative investments, not traded in the stock market. Through SecondMarket, buyers and sellers of alternative investments can access robust market data, create an online investment identity, build a comprehensive investor network and transact across a broad array of alternative assets.

 

By last two weeks, including more than 2 billion outstanding shares, Facebook is worth about $66 billion. Since the 10th auction in Second Market, it has lost about a billion dollars.

 

Tekedia thinks that one of the major reasons while Facebook  has this astronomical value is Zynga, the social gaming company. One percent of its players contribute about 25- 50% of its revenue (about $592 million in 2010), according to Businessweek.  So Zynga has a huge opportunity if the other 99% could start paying. If Zynga moves out of Facebook to Google Plus through a partnership agreement, Facebook value will drop below $50b. But right now, Zynga builds the farms in the land owned by Facebook.

 

Also, Tekedia thinks that Facebook ad is primitive and that is where Google Plus could strike. The static images by the right hand side of user’s profiles do not add any major value. Few people care to see those images. If Google plus offers a more dynamic and less instructive ad network, advertisers will follow. It is about value and right now, Facebook ads do not add any value.

 

So, in the next Facebook Second Market, we will see what the impact of Google Plus has been on the minds of investors. That Google plus is coming does not mean that Facebook is gone. What it means is that advertisers have a choice. Most times, that could be hugely important.

 

NB: The photo is from our Second Market trading account. We are investing in Zynga, not Facebook.

AFRIT – IEEE African Students Mentoring Ends Next Month. Connect Now!

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On AFRIT website  and IEEE website.

This program will end next month. Connect if you have not done so.

 

Members of IEEE Boston GOLD are very excited to announce a mentoring program it has developed to assist engineering students in Africa working on their undergraduate senior (final year) projects. This project is poised to help the students access a pool of experienced professionals who are practicing at the cutting edge of science and technology. The mentors will guide the students, providing important directions as they work with their local universities or polytechnics on their projects. Only projects that involve electrical, electronics, computer engineering and related fields will be supported.

 

This service is completely free. We emphasize that the goal is to help the students develop skills with directions on how to approach some engineering problems. Members of GOLD will not be solving their problems for them. The support could range from helping to design a circuit to developing a test strategy.

 

Interested students are asked to send a two page free application, describing their projects and what they will need from us. Upon receipt and approval, the project will be assigned to one of our members whose skills and interests align with the students projects. Through email and video communication, the mentor and the student will work together as the former helps to direct the latter.

 

This program will be administered by the African Institution of Technology and technically driven by the IEEE. It will run as a pilot project from August 2010 to August 2011 and will be continued, if necessary.
To submit a project, kindly send the application to ieee@afrit.org.

 

About IEEE: IEEE is the world’s largest professional association dedicated to advancing technological innovation and excellence for the benefit of humanity. IEEE and its members inspire a global community through IEEE’s highly cited publications, conferences, technology standards, and professional and educational activities.

 

 

About African Institution of Technology (AFRIT): AFRIT is a technology focused non-profit organization with the aim of facilitating emerging technology diffusion in Africa. It has organized more than 35 engineering workshops and seminars in the continent.

 

Contact Sam John, AFRIT COO.

 

Guanghua School of Management, Peking University To Translate Our Works Into Chinese

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Editor’s Note: Tekedia Founder has approved for GSM Peking University China to translate his HBR posts into Chinese. They are also evaluating others works in a follow up email. Below is a redacted email from the school rep.

 

Dear Professor Ndubuisi Ekekwe,

 

This is Jie Wang. I am writing as a representative for GSM thinker to
ask for your authorization to translate your blog articles into Chinese for our Website www.gsmthinker.com (under development) I am planning to post your articles in the form of expert column.

 

GSM thinker is set up by Professor Weiying Zhang as the Web 2.0
platform for Guanghua School of Management, Peking University. We are
aiming at building up the No. 1 online Chinese Business Review. We
cover issues from Economy Environment, Public Policy, Leadership,
Strategy, Finance and Business Report. We are responsible for
promoting the knowledge, ideas and wisdom about business to the
public.

 

 

I read your articles via http://hbr.org/, it is attracting and
interesting. I feel that you fully deserve the title of leading expert
in business. I sincerely request your authorization as your articles
are of great signification to the Chinese scholars and entrepreneurs.
I wish to hear from you soon.

 

 

Best regards,
Jie Wang
GSM thinker, Guanghua School of Management, Peking University

Room 418, Guanghua Old Building, Guanghua School of Management, Peking
University, Beijing, 100871

No Engineer In Jonathan’s Ministerial List – Nigerian Society of Engineers (NSE) Bemoans

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Press Statement

by

The Nigerian Society of Engineers

 

 

MR PRESIDENT, RECONSIDER MINISTERIAL NOMINEES
TO ACHIEVE REAL PROGRESS AND PROSPERITY FOR NIGERIANS

 

The Nigerian Society of Engineers, the umbrella body for all engineering professionals  in the country is worried over the list of Ministerial nominees  sent to the Senate for confirmation in the ongoing screening exercise  as this does not reflect the spirit of the moment and the desire of the Nigerian people to have astute professionals in key areas of the economy especially Infrastructure.

 

In a country where there are many key Engineering- based  Ministries , the Society is shocked that there is no single engineer in the President’s list. We therefore ask – who is to man these ministries? Over the years, we have advocated that square pegs be put in square holes in Ministries of Power, Works, Water Resources, Communication, Industries, Steel and Petroleum, etc . Many of these ministries have not had an Engineer as a minister since the inception  of the Fourth  Republic in 1999.

 

It is rather curious that despite the Government avowed intention to improve power supply in the country over the years, the Ministry of Power  has not had a Power Engineer to drive the initiative as minister, as a typical example. This is a clear demonstration that the Government has not got its priorities right as the value of  an experienced professional in that position should not  be a matter for debate.

 

The Society is dumbfounded that  none of the nominees in  the list so far, both confirmed and those about to be confirmed, is an Engineer  and wonders which of them would pilot a knowledge- driven policy formulation and implementation  in the engineering based ministries listed earlier.  We believe that we cannot fold our hands and watch the administration drift away from the expectations of  professionals and many Nigerians.

As  earlier stated in our memo titled “The Route to Progress and Prosperity “ to  President  Dr.  Goodluck Jonathan, GCFR,  The Nigerian Society of Engineers  is  of the view that the success of Mr. President in his role as Executive-in-Chief would hinge on his success in attracting and selecting appropriate talents into both political appointments and employment in public service.

 

With the President’s garb of the Executive-in-Chief, it behoves  him to put emphasis on an approach that will produce the best End-Results. This approach is clearly weighted in favour of Technocrats being appointed into the cabinet of Mr. President.

Therefore, in the view of Nigerian Engineers, Mr. President must be willing to seek people who have different and diverse backgrounds with pedigree and  the track records of success in particular sectors.

 

The process of screening so far observed does not indicate the portfolios for which the candidates are being considered. Surely the field of competence of a candidate should be paramount to the expected performance  in the intended office. This is the only fair and transparent way of ensuring that square pegs are put in square holes as mentioned earlier. The outcome of this process if adopted would guarantee that each minister may not require an unnecessarily long term in office to deliver.

 

For the sake of performance, and quality executive service to the citizenry, Nigerian Engineers on behalf of Nigerian professionals again demand that the President constitutes his cabinet with at least 60% Technocrats.

 

In making this demand, Engineers strongly recommend to Mr. President to depoliticize the selection process and demystify the senate screening exercise by attaching portfolios to those nominated for ministerial appointments. This process would have helped the Senators in the screening exercise as they would have focused their attention on the sector so designated. This has not happened.

 

The Nigerian Society of Engineers therefore calls on Mr. President to quickly make amends in  his nominations if the much talked about transformational agenda of his government aimed at swiftly delivering progress and prosperity to Nigerians  is to be realised.

 

Engr. Olumuyiwa Alade Ajibola, FNSE
President, Nigerian Society of Engineers
.

 

Editor’s Note: Barth Nnaji is not an engineer as per NSE definition without COREN certification though he was once the best robotics professor in America.

Adoption of This Technology will Make Nigeria Leapfrog South Africa in GDP

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Outlook on Nigeria:  For Nigeria to realize the Vision 2020 and become the 20th largest economy, it must grow at least 9.5% annually within the next eleven years, 2010 included. It is currently ranked 44th ($174b (nominal), 2009) and chasing Belgium which is 20th ($471b, 2009), according to IMF.  Making that jump will require a compounded interest of 298% by 2020 which will translate to 171% percentage growth in the GDP. This analysis assumes that the GDP of the 20th economy will remain constant in 2020. For a nation that has averaged about 5.5% in growth, in the last seven years, it does mean that it needs a new growth engine.

Yet, while one can dismiss the bold vision of Nigeria’s government, it is important to note that in 1999, the GDP was $34.8b. A combination of policies and massive ICT investment, the nation moved from 105th position in global GDP ranking to 44th today. Though the ICT market is still one of the fastest growing ones in the world, the FDI has slowed down.

 

Now, Nigeria needs another engine to drive growth. Our analysis shows that a 50%* penetration rate of creative semiconductors and microelectronics will produce a compounded interest of 300% in the next ten years and make Vision 2020 a reality. This will create excess of one million direct and indirect jobs. The study shows that microelectronics will accelerate Nigeria’s overall growth since most ICT products will then be made in Nigeria, if MNCs build plants, over mere distribution and sale of their electronics and ICT products. When we benchmarked with Asia, we noticed that Nigeria has advantages in currency, wage, regulations, and other factors for oursourcing. The clustering effect and ability to develop technology districts, anywhere without regards to any raw material but knowledge, show that microelectronics will position Nigeria for greatness.

 

To make this possible, Fasmicro has a clear roadmap to help the Nigerian government (federal, state, or local) develop the industry through targeted policies and stimulations. We are proud of our four years of experience in a United States National Science Foundation committee, which has helped us master the act of crafting and implementing successful roadmaps.

 

*Our diffusion model is not the traditional home penetration model, rather one that focuses on SMEs. If there are hundred technical companies and fifty use microelectronics/semiconductor products creatively, we will assume a 50% penetration rate. If none uses creatively, all does sale and distribution, we assume 0% diffusion. We are looking for value creation either by using already created microelectronics related products or by actually developing new ones. That makes us assign a high value to a (potential) Lagos maker of Video Games and nothing to a firm that distributes video games.

 

We focus on value because a company that takes silica (sand), the starting material of semiconductors, and produces a microchip may be transforming a N100 worth of sand to a value of N100,000 while the one that sells that end product makes only marginal gains (few hundreds of Naira). That high value creation is our focus in this diffusion model and not the use of the products by end consumers. Practically, Zinox Computers (Lagos) gets a high score from us because they create value while most computer distribution firms in Ikeja Computer Village get zero in our model.