Status update: Facebook to go public, raise $5B
New York ? Facebook made a much-anticipated status update Wednesday: The Internet social network is going public eight years after its computer-hacking CEO Mark Zuckerberg started the service at Harvard University.
That means anyone with the right amount of cash will be able to own part of a Silicon Valley icon that quickly transformed from dorm-room startup to cultural touchstone.
If its initial public offering of stock makes enough friends on Wall Street, Facebook will probably make its stock-market debut in three or four months as one of the world’s most valuable companies. Facebook, which is now based in Menlo Park, Calif., hopes to list its stock under the ticker symbol, “FB,” on the New York Stock Exchange or Nasdaq Stock Market.
In its regulatory filing with the Securities and Exchange Commission, Facebook Inc. indicated it hopes to raise $5 billion in its IPO. That would be the most for an Internet IPO since Google Inc. and its early backers raised $1.9 billion in 2004. The final amount will likely change as Facebook’s bankers gauge the investor demand.
Joining corporate America’s elite would give Facebook newfound financial clout as it tries to make its service even more pervasive and expand its audience of 845 million users. It also could help Facebook fend off an intensifying challenge from Google, which is looking to solidify its status as the Internet’s most powerful company with a rival social network called Plus.
The intrigue surrounding Facebook’s IPO has increased in recent months, not only because the company has become a common conduit — for everyone from doting grandmas to sassy teenagers — to share information about their lives.
Zuckerberg, 27, has emerged as the latest in a lineage of Silicon Valley prodigies who are alternately hailed for pushing the world in new directions and reviled for overstepping their bounds. In Zuckerberg’s case, a lawsuit alleging that he stole the idea for Facebook from some Harvard classmates became the grist for a book and a movie that was nominated for an Academy Award last year.
Following the model of Google co-founders Larry Page and Sergey Brin, Zuckerberg set up two classes of stock that will ensure he retains control as the sometimes conflicting demands of Wall Street exert new pressures on the company. He will have the final say on how nearly 57 percent of Facebook’s stock votes, according to the filing.
Even before the IPO was filed, Zuckerberg was shaping up as his generation’s Bill Gates, a geek who parlayed his love of computers into fame and fortune. Forbes magazine estimated Zuckerberg’s wealth at $17.5 billion in its most recent survey of the richest people in the U.S. A more precise measurement of Zuckerberg’s fortune will be available once the IPO is priced and provides a concrete benchmark for determining the value of his nearly 534 million Facebook shares