Advertising dollars are far more lucrative if you think you can trust where you're sharing your deepest, darkests...
Imagine what people would share between themselves if it wasn't "public for the world to see". Imagine how many more data points that would produce for targeted advertisements on the Facebook platform, alone.
Edit: Including necessary reference to Bill Hicks[0].
You mean like a Google search?
If you don't mean a Google search, I'm not sure what you could mean. What could possibly be more intimate than a person's lifelong history of general queries in their pursuit of knowledge and personal identity?
Oftentimes those queries are even natural language sentence fragments that directly convey the person's intentions.
What more are you claiming a company could infer by convincing their userbase that their data remains private?
If you're considering buying a motorcycle and have a friend (or a group of friends) that own(s) a motorcylce, are you more likely to ask that friend (or that group) the pros/cons of owning a motorcycle and for their recommendations or are you far more likely to use "nature language sentences" in Google to illicit that information (e.g.: "I'm thinking of buying a motorcycle")?
I'm going to posit that the former occurs far more frequently than the latter and that this is the potential "untapped market" for targeted advertising that a "private social network" would be after.
Regardless, it's pretty easy to infer from the person's Google searches what their friends told them. And if that user has an Android phone Google also has their location data to cross-reference with it, plus data gleaned from CC purchases and probably lots of other sources I haven't yet read about.