Facebook aims to raise US$5bn through flotation
FACEBOOK could be heading for a record stock flotation after unveiling plans to sell shares to the public.
The social networking site aims to raise five billion US dollars in what is expected to be the biggest initial public offering (IPO) from an internet company.
Eight years after it began, the company now has 845 million monthly users worldwide and last year made a profit of one billion dollars.
Registration documents filed with the Securities and Exchange Commission (SEC) also reveal that founder and chief executive Mark Zuckerberg, 27, owns 28.4% of Facebook.
The documents do not include Facebook’s market value, but reports suggest it could be as much as 100 billion dollars.
You may also want to watch:
Facebook hopes to raise five billion dollars in its IPO, which would be the most for an internet company since Google Inc raised 1.9 billion in 2004.
In a personal letter, Mr Zuckerberg stresses that Facebook’s “social mission” was to “make the world more open and connected”.
- 1 Ipswich Town reveal full retained list as six first-teamers get extended stays and eight depart
- 2 Town take up contract options on duo with plenty of departures still expected
- 3 Chambers and Skuse set to be headline exits on day of departures at Ipswich Town
- 4 Mark Heath: The Town players Cook should keep and release today
- 5 Suffolk estate which featured on TV show on the market for £1.25m
- 6 Town confirm four more exits at end of season
- 7 Chambers and Skuse to leave Ipswich Town
- 8 Man in 20s dies in collision between lorry and pedestrian on A14
- 9 Search for man after girl, 10, accosted at B&M store in Stowmarket
- 10 New cocktail bar and tapas restaurant to open in Ipswich
He adds: “We don’t wake up in the morning with the primary goal of making money, but we understand that the best way to achieve our mission is to build a strong and valuable company.
“This is how we think about our IPO as well. We’re going public for our employees and our investors. We made a commitment to them when we gave them equity that we’d work hard to make it worth a lot and make it liquid, and this IPO is fulfilling our commitment.
“As we become a public company, we’re making a similar commitment to our new investors and we will work just as hard to fulfil it.”
Describing Facebook’s philosophy as the “Hacker Way, he adds: “Hackers believe that the best idea and implementation should always win - not the person who is best at lobbying for an idea or the person who manages the most people.”
In its most recent survey of the richest people in the US, Forbes magazine estimated Mr Zuckerberg’s wealth at 17.5 billion dollars.
The documents make clear that he will retain majority control of the business after the flotation and will be paid a reduced salary of one dollar from January 2013.
His company’s story was the subject of a 2010 Hollywood film, The Social Network, which scooped three Oscars.
The filing with the SEC highlights Facebook’s huge growth since it was first dreamed up in a Harvard University bedroom in 2004.
Its revenue last year was 3.7 billion dollars, up from 153 million in 2007, with the majority earned through advertising.
It made a profit of 606 million dollars in 2010, which jumped to one billion last year.
Facebook estimates that its users upload 250 million photos each day, are linked into 100 billion friendships and make 2.7 billion “likes” and comments every day.
But the documents also spell out the risks facing the company, such as “significant competition” from the likes of Google, Microsoft, and Twitter.
Facebook is the latest in a series of online firms to sell shares to the public in recent months, following online voucher firm Groupon in November and online games maker Zynga in December.