Facebook, which currently boasts having 483 million daily active users, filed with the SEC for an Initial Public Offering (IPO) yesterday. The full paperwork can be viewed here, but we’ll cut right to what you want to hear about: how much money is involved, who’s getting filthy rich, how dependent are they on Farmville, and other
gossip key metrics you need to know to survive in today’s fast-paced economy.
They’re attempting to raise $5 billion selling shares of stock under the symbol “FB.” For comparison, Google IPO’d at $2 billion. Prior to the sale, Mark Zuckerberg’s share of voting power in the company was $56.9%; after the sale he’ll hold 28%. The 27-year-old is currently estimated to have a larger than $25 billion net worth; that’s 25-times cool.
The total value for the company is estimated to be nearly $100 billion, which is almost double what the company’s value was pegged at during a private sale of stock in December of 2010. If accurate, this means co-founder Dustin Moskovitz is holding nearly $7 billion in shares, Jim Breyer is holding $10 billion, Sheryl Sandberg may have $2 billion available in stock options, and Peter Thiel is holding $2.2 billion, which will buy him plenty of floating island kingdoms.
Perhaps most interesting though is the case of graffiti artist David Choe, who in 2005 agreed to be paid in stock to paint the walls of Facebook’s offices in 2005, since the fledgling company had very little cash at the time. The estimated worth of that stock now? $200 MILLION!!!
Reports the New York Times:
In 2005, Mr. Choe was invited to paint murals on the walls of Facebook’s first offices in Palo Alto, Calif., by Sean Parker, then Facebook’s president. As pay, Mr. Parker offered Mr. Choe a choice between cash in the “thousands of dollars,” according to several people who know Mr. Choe, or stock then worth about the same.
Mr. Choe, who has said that at the time that he thought the idea of Facebook was “ridiculous and pointless,” nevertheless chose the stock.
Many “advisers” to the company at that time, which is how Mr. Choe would have been classified, would have received about 0.1 to 0.25 percent of the company, according to a former Facebook employee. That may sound like a paltry amount, but a stake that size is worth hundreds of millions of dollars, based on a market value of $100 billion. Mr. Choe’s payment is valued at roughly $200 million, according to a number of people who know Mr. Choe and Facebook executives.
We also learned from the SEC filing that Zynga (the makers of Farmville) account for 12% of Facebook’s revenue. Facebook’s total revenue last year was $3.711 billion, an 88% increase over the year before. They have $3.9 billion in cash on hand and made $1 billion in net income last year (a 65% increase over their 2010 net income).
Facebook has been trying to move away from depending only on advertising for revenue. All their revenue came from ads in 2009, then 95% in 2010. Last year, ads accounted for 85% of their revenue, while revenue from Facebook Payments increased 500%. That said, with 85% of revenue coming from ads, this means Facebook is more reliant on advertising than any old-media business.
The SEC filing also included a letter from Zuckerberg as well as this picture from some of Facebook’s 3,200 full-time employees:
As someone who’s endured countless hours of haranguing from his mother to join Facebook and send her Farmville gifts, let me just say, you’re welcome.