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Facebook Files $5 Billion IPO, Values it at Nearly $100 Billion

Discussion in 'News' started by btarunr, Feb 2, 2012.

  1. btarunr

    btarunr Editor & Senior Moderator Staff Member

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    Facebook Inc., has finally filed to go public with its IPO, with plans to raise US $5 billion, according to a figure used to calculate the registration fee. The company seeks to trade under the ticker symbol "FB", although it did not list an exchange. It is speculated by those close to the company that Facebook is aiming at a far greater offering that will value to the company close to $100 billion. Facebook also provided some interesting stats about its operations in its filing. The EDGAR filing documents can be accessed here.

    [​IMG]

    Source: Engadget
  2. Volkszorn88

    Volkszorn88

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    Makes me happy every day knowing I don't have a facebook.
  3. twilyth Guest

    source

    So basically they are being valued at 75-100 times trailing earnings. Yeah, that sounds legit. :wtf:
  4. LagunaX

    LagunaX

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    Oh yeah I really want to give Zuckerberg some more money as if he doesn't have enuf billions now.

    Can you say big brokers and insiders making cash off the initial IPO as us mindless lemmings rush towards the wave of buying only to hit the bursting bubble shortly after?

    No thanks.
    w3b says thanks.
  5. Jaffakeik

    Jaffakeik

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    how could they make such profit, are people really so stupid to buy extras and premiums in facebook games for money?
  6. twilyth Guest

    What's interesting to me is that they have close to a billion users, half of all internet users worldwide, and they're making basically a dollar and change off of each one. Considering that they only have another billion potential users, where's the growth going to come from that justifies this kind of valuation? You can buy Microsoft for 11 times earnings. MSFT is a mature company, but still, you have to have at least a colorful story for how you intend to grow rapidly enough to justify a valuation of at least 75 times.

    If recent media IPO's like Zynga and Pandora are any indication, people aren't impressed by the razzle-dazzle of tech any more. I think both of those offerings are now selling for about 20% less than what they sold for on the day they were listed. A lot of people got severely burned in the dot com boom and most haven't forgotten about that yet.
  7. Completely Bonkers New Member

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    The wonderful fall and rise of some "virtual" tech companies like fb is that they can easily be substituted, just-like-that! It isnt like a utility company with a geographically tied customer base, or a manufacturing company with a specific production or distribution capability, or a resource like oil, gold or diamond.

    It wouldn't take even $1billion dollars for someone to develop an alternative incl. sufficient promotion to get it successfully off the ground. (linked-in?). And while they might not get quite the market share of fb which succeeded while there was a void in the market for this type of application, a credible alternative would turn that "$100 billion value" of fb very quickly down to "$10 billion" and possibly very quickly again down to "$1 billion".

    There is only downside, not upside.

    However, IT IS A SMART MOVE of Zuckerbergman to capitalise NOW while he can on perceived "overvalue". You have to admit, he's a clever cookie.
  8. W1zzard

    W1zzard Administrator Staff Member

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    actually there is no big money to be made from this IPO i hear (in the opinion of many bigger investors). facebook already has like 300 investors that hold a sizable share of the company - these are the guys that will make huge profits from a good ipo
  9. Yo_Wattup New Member

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    its from all the ads dude
  10. Completely Bonkers New Member

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    Those revenue numbers are very impressive.
  11. NC37

    NC37

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    I think you just answered your own question...;)
  12. R_1

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    Facebook has some real value. Same goes for Google, Steam and other companies, doing services, that people actually want. I think that Facebook made a clever move, because it will obtain a lot more money for that 5 billion IPO.
  13. Ammonite

    Ammonite New Member

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    I'm still waiting for the time when FaceBook finally fizzles out. Its constantly trying to reinvent and redesign itself to keep things interesting, but how long until crappy apps and status updates just get old?

    I'm still hoping FB and social networking will pass eventually and in a couple of decades be remembered as one of many things that defined this time and the generation associated with it.
    w3b says thanks.
  14. R_1

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    Well, to my understanding what is to be a current technology trend is leaning towards Google business model and lately Apple contribution to a modern channel for digital media distribution. Both of these business practices are fairly new and only recently become possible, so there is no guarantee that "old" ones like Big media are not going to strangle them, through legislation or something equally clever. Facebook long term success shall be considered very likely , if Google and company prevails in this rivalry. Let's see, future shall reveal itself.
  15. _JP_

    _JP_

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    Good for them, still not going to create an account.
  16. chaotic_uk New Member

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    one word comes to mind = YES :D
  17. Ammonite

    Ammonite New Member

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    Not to mention the advertising revenue must be insane.
  18. NdMk2o1o

    NdMk2o1o

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    This is the main source of their revenue, not from add-ons or premium content as FB does not charge their customers for ANYTHING, 3rd party games and apps DO have premium options though.
  19. twilyth Guest

    Why do you do an IPO? Going "public" as they say imposes a lot of restrictions and requirements that a private company doesn't have. Just take for example the information presented in their S1 filing about revenue, number of users and so on. This was all carefully guarded information in the past. So, why do it? FB could have continued to get investment in other ways. They haven't grown to this point by sucking on the quantum vacuum.

    I don't think anyone knows the answer to this for certain, but I have a couple of guesses. First, I think FB sees it's rate of growth starting to flatten. So last year they grew by 65% in terms of revenue. What will it be for next year? Once analysts get a chance to digest the numbers presented, we'll get some idea of their future trajectory and my bet it's down. But this was also true for Google and that has worked out well for investors.

    Second, I think FB is feeling the competition from the fact that so many other web destinations are incorporating interactive "community" features. Someone mentioned Steam, and that's a perfect example. You can go in Steam and not only play "real" games but interact with your friends while doing so. There are also the more obvious competitors like Google +. There you have a service that has been designed from the ground up to out facebook facebook. I don't think there is any doubt that things such as these currently impact facebook's growth and that their influence and affect will only accelerate.

    So by going public now, I think Facebook quite literally capitalizes on the strength of its current market dominance and does so before the pending threats to that dominance are fully recognized.
  20. pr0n Inspector

    pr0n Inspector

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    You mean like Usenet newsgroups, IRC, IM and eventually forums?

    Are you by any chance viewing this page by sending an email to a daemon which runs wget and mails the page back to you?
  21. MikeMurphy

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    no thanks
  22. Animalpak

    Animalpak

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    have access to personal data and privacy of people have a very high price but also a modern way to hurt people ... International criminal organizations benefit.
    w3b says thanks.
  23. Roph

    Roph

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    Just remember how fast Myspace died :)
    w3b says thanks.
  24. Ammonite

    Ammonite New Member

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    Systems like IRC and forum software are practical and have been picked up by billions of people for millions of websites, used because there is no better alternative.

    FaceBook is just a novelty act that resides on a single website, its best practical use being ways for companies to connect and market to a large online audience (hardly useful for the end user). Sure, its embedding itself into people's lives, but so did MySpace and all that other junk that has since dried up and become nothing like its former self.

    All it'll take for FaceBook to die is another person bettering it, or people getting bored of it.
    Norton says thanks.
  25. NinkobEi

    NinkobEi

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    Hate to say it but Facebook may be around to stay for a while. Technology only phases out as other better things make it obsolete. Facebook changes with the times very well. And barring some catastrophic business model disaster, it has one valuable commodity: LOTS OF LOYAL USERS.

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