Facebook Going Public

Facebook Going Public

There have been a lot of rumors circulating around last year about Facebook going public.  Although the social media giant hasn’t made an official statement yet, there are just too many clues to ignore.  A lot of investors will want to get their hands on Facebook and are excited about Facebook going public.  So when will they make the announcement and what should you be looking out for?  Lets dive deeper into the rumors.

Facebook Going Public | How it Breaks Down

Since the mentions of Facebook going public, many people are wondering what the true value of the company.  This year Facebook grossed $10 billion and their estimated value is $100 billion IPO (initial public offering).  This is a record breaker for any tech company out there including Google.  Mashable reports on Facebook going public.

The company itself is preparing to raise $10 billion this year, according to reports, to push the company’s public value to $100 billion. More than Disney ($61 billion), Amazon ($88.3 billion) and McDonald’s ($95.6 billion).

Wow, thats just wild that a company that launched its platform in February 2004 is going to be worth more than McDonalds!

Facebook Going Public | Bringing Home the Bacon

Facebook going public is definitely going to make some people very very rich.  But who will be bringing home the bacon besides Mark Zuckerberg?

Who will be cashing in? Facebook CEO Mark Zuckerberg, co-founder Dustin Moskovitz, co-founder Eduardo Saverin, co-founder Chris Hughes and Sean Parker, Napster co-founder and Facebook partial owner (he owns 4% of Facebook). Zuckerberg will make an estimated $25 billion, owning 24% of the company.

http://mashable.com/2012/01/11/facebook-ipo-infographic-2/

So if thats the case just how are they going to raise the $10 billion dollars by April or May?  More advertising for Facebook Fan Pages and display ads.  So prepare to be flooded with ads.  Will they increase the price for PPC ads?  That hasn’t been revealed as of yet.

Facebook Going Public | Stats

Lets take a look at some stats and things that you should know about Facebook going public:

  •  Shareholders:
    •  Mark Zuckerberg (Founder): 24%
    • Dustin Moskovitz (Co-Founder): 6%
    • Eduardo Saverin (Co-Founder): 5%
    • Peter Thiel (PayPal Founder): 3%
    • Other: 58%
  • Users
    • 800 million users
    • Thats 1 in 10 humans on Earth using Facebook
  • Projected Revenue
    • 89% of the revenue comes from advertising
    • 11% comes from Facebook Credits
    • That’s 1/6th of the US’s display ad revenue.
    • Facebook will make 4.2 billion dollars this year, Apple makes the same in just 3 weeks.

I’d like to know how much shares will cost with Facebook going public.  With those kinds of stats it certainly won’t be cheap.

Facebook Going Public | Why?

Most companies go public to raise capital and make the founders very rich.  Is this why Facebook is going public?  Mashable reports on Facebook going public doesn’t seem to think so:

One major reason is that private trading in the company is pretty much maxed out. Under U.S. laws, once you get 500 or more private shareholders, you have to publish detailed data about your company’s financial performance. Private trading in Facebook as well as ZyngaTwitter and the pre-IPO LinkedIn also drew scrutiny from the SEC last December.

In addition to the feds, though, Facebook also has to content with a rivalry from Google+. As The Economistnotes, “Facebook will want to seek a listing before rivals erode its lead in the social-networking sphere.”

Although I really don’t think Google+ will be taking the number one spot for social networking sites, I do think its good timing for Facebook going public, just to be sure that they still wear the crown.

Facebook Going Public | Bottomline

So Facebook will be the largest tech IPO in history, but not the largest ever in history.  Nevertheless Facebook going public is going to change the face of social media forever.

Image attribution: http://mashable.com/2011/01/03/facebook-ipo-may-2012/