Get ready, get set … Facebook is going public.
Lottery players, you might want to fill out a different sort of “ticket” to become an instant millionaire. Facebook founder Mark Zuckerberg and his colleagues have created a nationwide frenzy as the social media behemoth is reportedly preparing to file for an initial public offering (IPO) with the Securities and Exchange Commission (SEC) on Wednesday, Feb. 1.
According to media reports, Facebook is trying to raise $10 billion, which would give it a valuation of $100 billion. If the reports are true and FB is able to achieve that ambitious goal, it would set several major distinctions, mainly:
— Have an IPO more than six times that of high-tech rival Google. Google currently holds the record for the largest technology IPO, according to Renaissance Capital, of $1.66 billion;
— Be the sixth-largest U.S. IPO ever, landing between AT&T Wireless and Kraft Foods;
— Be the 15th-largest IPO in global history, resting behind Glencore International and ahead of Japan Tobacco;
— Come in with more hype than other technology companies, thanks to a per-share valuation that at least one investment firm predicts will open north of $100, Forbes reports. When Apple went public Dec. 12, 1980, it was priced at $22 per share, climbing to $29 by the end of the trading day, according to Walter Isaacson’s account on the life of Steve Jobs. The Wall Street Journal reported that Apple made less than $100 million by selling stock to the public. Google, according to archives from The Washington Post, was valued at $85 per share, surging to over $100 a share by the end of the day for a market capitalization of $27.2 billion;
– Have a market capitalization larger than iconic American conglomerates like Amazon ($87 billion), Disney ($70 billion) and General Motors ($38 billion). However, Faebook would compare less favorably than its technology contemporaries and adversaries, Google ($187 billion), Microsoft ($248 billion) or the king, Apple ($422.47 billion).
Why would Facebook valuation be estimated at $100 billion? As Dominic Basulto writes, Facebook derives the majority of its revenues from advertising, something that Wall Street is reportedly not very excited about. Advertising and page views have a way of tapering out over time, as media companies can very much attest to.
But who will be the real winners when Facebook makes its initial public offering? That list, along with the amount they stand to make, is absolutely staggering and may shock you. See below: –terry shropshire