The fact that Facebook wants to acquire Twitter is not a surprise. Both are hot Web 2.0 companies that have seen meteoric increases in viewership. Facebook, started as a site for college students, has exploded since opening itself to a broader audience. Twitter, the miniblogging site, lets users report their current state of mind or location in 140 words or less.

Also, like many Web 2.0 companies, neither Facebook nor Twitter have demonstrated that they can make money on a scale that matches their vast numbers of users. And that's where things get complicated.

Several news organizations reported this week that the two companies are in talks and that Facebook has proposed a stock deal that would set the value of Twitter at $500 million. However, since Facebook is a private company, a sticking point is going to be setting a value on that stock.

Valuations are often determined in the basis of a company's last transaction. When Microsoft invested in Facebook last year, the company's valuation was reportedly set at $15 billion. But with the economic downturn and the dificulty that companies have raising money or exiting from their investments, such high values are likely difficult to maintain.

The Financial Times reports that Chris Sacca, a Twitter investor, questioned the valuation at an investor's conference in Oxford, England.  “If Facebook brings $500m of stock to the table to buy Twitter, the first thing you talk about is whether that stock is worth $500m or not,” he said.

So a Facebook-Twitter deal will draw interest beyond a possible merger itself. Many investors and entrepreneurs will be looking for signs to determine what companies are worth in this very uncertain political climate.