Facebook gets a status update with $5bn flotation plans

Linsey Fryatt 2012-02-02 0

• The social networking site has 845 million users
• Company could be valued between $75 and $100bn
• Zuckerberg and Co seek to raise $5bn

facebook

 

Facebook finally went public yesterday and filed its prospectus for IPO (Initial Public Offering) late last night (German time). The social network revealed a trove of financial information about itself in readiness for its stock-market debut – still on track to be the biggest by an internet company.

The Facebook figures revealed

Mark Zuckerberg and Co have sought to raise $5 billion in initial funding – less than the $10bn figure that many analysts expected them to aim towards.

Information released from the IPO claims revenue of $3.71bn for 2011, an operating income of $1.756bn, and a net income of $1bn. Apparently 85% of those revenues are from advertising, with the remainder from social gaming and other app fees.

The released information also states a revenue growth of 88% from a year earlier, while the user group of 845 million monthly users is a growth of 39% in the same period.

It will take a few months for industry analysts days to digest the information made public last night, but when it does, Facebook’s stock market offering is expected to be historic, beating Google’s 2004 offering of $1.9 billion raised at a valuation of $23 billion.

Facebook billionaires

When the stock floats it will also create a new pool of wealth in Silicon Valley – with key shareholders finding themselves billionaires, and more than a third of the 3,000-strong Facebook staff as millionaires – on paper at least.

Zuckerberg himself owns around 28% of the company and 57% of its voting share power. It is thought that the 27-year-old will sell shares to free up some wealth and to pay requisite taxes.

His estimated personal fortune post-flotation is estimated to double to around $28bn. Not bad for someone whose letter accompanying the IPO began: “Facebook was not originally created to be a company. It was built to accomplish a social mission – to make the world more open and connected”

Facebook by numbers

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