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File Under Oops: The “Washington Post”-Facebook Windfall That Got Away
How the Post Company missed out on a deal that could have been worth $7 billion.
Back in 2005, Donald Graham’s friend Mark Zuckerberg offered to sell him 10 percent of his young and growing company, Facebook. According to the book The Facebook Effect, “Graham and Zuckerberg verbally agreed to terms of a Washington Post Company investment in Facebook.”
Before the deal was sealed, Zuckerberg got a better offer from another company, and when he brought it up to Graham, the Washington Post chairman “released him from his obligation to the Post [Company].”
Today, with the Facebook IPO, that 10 percent could be worth more than $7 billion. According to PrivCo, which researches private companies, that would be at least “double the market capitalization of the entire Post Company.”
All’s not lost for Graham, however. He sits on the Facebook board and, according to Forbes, holds 1 million shares of Facebook stock. Those shares now could be worth as much as $50 million.
Graham would not comment to The Washingtonian. A company executive said in an e-mail, “Don has nothing to say.” She included an earlier quote from him: “I won’t sell any Facebook shares as long as I’m on the board. When I leave, all my Facebook shares will be donated to two or three DC education-related charities.”
Regarding the 10 percent deal that never was, we send our condolences.
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