Yesterday, social media giant Facebook filed for a $5bn IPO.
So what is an IPO and why are Facebook doing it I hear you say? IPO stands for Initial Public Offering, the first time a private company opens it’s shares to the public. Presently, Facebook is solely owned by private investors. These range from Russian investment firms to Napster founder; Sean ‘Justin Timberlake’ Parker
A company usually files for IPO in order to raise some cash, although US federal laws govern that companies with a large number of investors and assets also open to the public.
As yet, there has been no indication as to how much of the company ‘Team Zucks’ are willing to release to public shares. Mark, the captain himself, “owns 1.1 billion Class B shares” equating to about a 57% steak writes AllThingsD. If Facebook is found to be worth the proposed $100bn dollars some are estimating it at, that could mean a cool $28bn in ol’ Zuckerberg’s pocket after a successful IPO.
What the company wishes to do with the newly generated revenue is also still up in the air. Could it be used to start developing the fabled Facebook Phone? Only time will tell on that one.
Would you be interested in owning part of the worlds most popular Social Network? Let us know in the comments below or (rather appropriately) on our Facebook page