MySpace as comparable to valuations of Web 2.0

Let's take one of the well known success stories in terms of Web 2.0 exit: MySpace, which was acquired by News Corporation for $580M in July 2005. At that time, the Web 2.0 frenzy was not yet overheated, so analyzing this case can be used as a baseline for later valuations like the investment in Geni earlier this year.

At the time of the buyout MySpace had some 25,000,000 registered users ("Profiles"). This means News Corp paid about 25 bucks per registered user.

This is not cheap; yet it seems that buying MySpace was probably a wise decision by News Corp; the results speak for themselves as you can see in the graphs below.

(Note: the graphs were compiled from publicly available data, and are not formal material released by News Corp / MySpace)

So less than two years ago, the price tag for a site with the strongest brand in its space was set at $25 a user. How does this compare to the estimated $500 per user, as reflected from the $100M valuation of Geni by Charles River as I calculated in this post?

Food for thought.