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Are social media companies overvalued? Infographic

Shifting social media company funding trends

Social media companies tend to be valued higher than traditional tech companies because of the perceived value often based on potential rather than existing value.

The infographic below outlines various social media companies have come into funding with a new trend toward companies with no users that haven’t even launched in beta yet, most notably illustrated by Color.

Critics are calling social media sites overvalued as now, $40 million can be seen by companies based on an idea while supporters note innovation is being funded more quickly than in years past as the social media arms race heats up after years of little to no change or innovation.

After reading the infographic below, tell us in the comments if you think the trends in funding are innovative or if social media companies are simply overvalued.

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