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Finally Facebook
February 1, 2012 5:03 PM   Subscribe

Facebook has submitted its S-1 Form to the SEC, beginning its road to an IPO. LinkedIn, Groupon and Zynga made their first stock available 3-6 months after filing their S-1 forms. The time is spent by regulators evaluating the statements made in the form, and the banks underwriting the issue finding buyers for the stock - which is unlikely to be difficult.

The form also confirmed some information already provided informally by Facebook, proved some estimates true or false and provided the first real insight into many parts of the secretive company:


Facebook's 2011 net income was $1 billion, on revenues of $3.7bn, and has paid or set aside $1.7bn in or for corporate taxes over the last two years. It currently has 845 million monthly active users, and is aiming to connect all 2 billion Internet users - a moving target. Currently, its penetration ranges from 80% in Chile, Turkey and Venezuela to 0% in China. One particularly interesting statistic was the amount of Facebook revenue directly contribute by Zynga - 12%, up on the previous two years.

Mark Zuckerberg's salary in 2011 was $483,333, with a $220.500 bonus. The next best-paid employee, COO Sheryl Sandberg, was paid $295,833, with $86,133 bonus and $30.5 million in stock awards. As of 2013, Zuckerberg's salary will drop to $1.

In his accompanying letter, Zuckerberg laid out the principles of Facebook's organzation, describing it as "The Hacker Way":
the vast majority of hackers I’ve met tend to be idealistic people who want to have a positive impact on the world.
This hacker way and its five core principles - Focus on Impact, Move Fast, Be Bold, Be Open and Build Social Value - are already being contrasted with Stephen Levy's "Hacker Ethic", with its focus on freedom of information and sharing, with discussion on how they might interact.

Regular Facebook users might see little change in their day-to-day experience, although the IPO filing did reveal that Facebook plans to introduce sponsored posts into users' mobile timelines. Whether this will lead to the same impact on usage as Beacon and Timeline remains to be seen.

Although largely textual, the IPO filing did contain, introducing its table of content, an iconic representation of friendships connecting cities created by Paul Butler.
posted by running order squabble fest (29 comments total) 5 users marked this as a favorite

 
The last link wasn't working for me. Here it is on imgur.
posted by distressingly thick sheets at 5:09 PM on February 1, 2012


Thanks, distressingly think sheets!
posted by running order squabble fest at 5:12 PM on February 1, 2012




According to the S-1, Mark Zuckerburg has 120,000,000 options for common stock at a strike price of $0.06 (in addition to his already ~20% equity holdings). I'm guessing that Mr. Zuckerburg would agree with Mitt Romney in that his current salary is "not very much." FML.
posted by gagglezoomer at 5:24 PM on February 1, 2012 [1 favorite]


Not super surprised about their net income, but the valuations that have been tossed around today (90 billion seems to be the number I'm hearing a lot) are ridiculous.
posted by Phire at 5:31 PM on February 1, 2012


The local 10 o'clock news last night about this, with the focus on how it will be a boost to the local economy - especially if you sell real estate or fancy cars.
posted by rtha at 5:31 PM on February 1, 2012


As another aside, I'm probably going to make a really bad business decision (considering how stupid it is for non-professionals to acquire common stock in a company they do not influence) and try to buy approx. $10,000 of common in the IPO. I missed the google money train and the apple money train... I just hope they're projections are conservative, because I'd like to make a downpayment on a house in a few years thanks to the potential facebook money train. If they can fully monetize their database, and fully maximize their zynga-type revenue, Facebook stands be a serious player in this decade.
posted by gagglezoomer at 5:31 PM on February 1, 2012


distressingly thick sheets: "The last link wasn't working for me. Here it is on imgur."

It's nearly a year old at this point, I wonder how the revolutions have spread its use across Northern Africa.

Interesting how it's dark in a lot of the former USSR. I wonder if Vkontakte (VK) with 140 million users is going to be stomped by Facebook soon.
posted by wcfields at 5:40 PM on February 1, 2012


If they can fully monetize their database...

Ah, so this is their game. To spread the guilt, and gain plausible deniability, for unleashing the final flood of privacy elimination.
posted by DU at 5:56 PM on February 1, 2012 [1 favorite]


I just hope they're projections are conservative, because I'd like to make a downpayment on a house in a few years thanks to the potential facebook money train.

You're joking right? I think this is some kind of meta-humor but my radar is unreliable.
posted by brain_drain at 5:57 PM on February 1, 2012



Ah, so this is their game. To spread the guilt, and gain plausible deniability, for unleashing the final flood of privacy elimination.

You're right. But you forgot to finish your sentence, I think, with "...for voluntary users of Facebook."
posted by gagglezoomer at 5:58 PM on February 1, 2012


As another aside, I'm probably going to make a really bad business decision (considering how stupid it is for non-professionals to acquire common stock in a company they do not influence) and try to buy approx. $10,000 of common in the IPO

I hope you work for Goldman Sachs or manage somewhere north of $500mil in assets if you think you can get any offering shares. Otherwise you won't get past security at the underwriter's offices much less close enough to try and write Zuckerberg a paltry 10k check before he laughs in your face.
posted by T.D. Strange at 6:00 PM on February 1, 2012 [1 favorite]


It's worth noting that (IIRC), that image is not representing all of (at that point) Facebook's 500 million users - rather it was modelling 10 million pairs of friends. So, a lot depends on the sample - and also, because it's aimed at trans- or international friendships, it would probably show less in areas with more tight-knit friendship groups.

Russia's interesting - VKontakte has 140 million users, but how many of those are spambots is probably an open question. There's also Badoo (which strains the definition of social network somewhat) and Livejournal is still plugging away... but Russia does seem like an easier market than China. Penetration in Russa is less than 15% at the moment, according to the filing, comaprable with Japan and South Korea.
posted by running order squabble fest at 6:03 PM on February 1, 2012


You're joking right?

Yes. But I do think there is the possibility that there is extreme untapped and unexpected value in Facebook, just as with Apple in 2000. The analysts' just didn't foresee the success of things like the iPod and what not.

Also, yes, I know that I'm not getting any initial allocation of shares from the underwriters in the IPO, but I might try to pick some up when trading commences.
posted by gagglezoomer at 6:04 PM on February 1, 2012


..you forgot to finish your sentence, I think, with "...for voluntary users of Facebook."

...and the non-users they gather data on anyway.
posted by DU at 6:07 PM on February 1, 2012 [1 favorite]


It's going to be interesting to see what happens to these sorts of companies, and of course I am thinking of Facebook and google, when they run out of formerly private user data to sell to their customers. Peak deprivatization theory, anyone?
posted by LastOfHisKind at 6:11 PM on February 1, 2012


DU,

Thanks for that link, I will read the articles. I was not aware of this. I guess the lesson is, don't go to facebook.com unless you don't care about your privacy.
posted by gagglezoomer at 6:14 PM on February 1, 2012


During 2009, our board of directors authorized us to award two million shares of Class B common stock to a family member of our CEO. This award was made in satisfaction of funds provided for our initial working capital and potential related claims. We recorded share-based compensation expense of $9 million related to this stock award for the year ended December 31, 2009.

Nice return.
posted by unliteral at 6:19 PM on February 1, 2012


That's lawyer speak for, "We're gonna hook this guy up for writing us a fat check back in the day."
posted by gagglezoomer at 6:23 PM on February 1, 2012


This just in, there is no more privacy. Get over it or go live off the grid.
posted by cavalier at 6:30 PM on February 1, 2012 [1 favorite]


Today Zuckerberg shared this picture of a sign on his desk.

"Stay Focused & Keep Shipping"... if he were better focused, he'd use a more accurate term than "Shipping"... unless it means he wants to keep writing Buffy fanfic. (You think Zuck's a Spike or Angel guy?)
posted by oneswellfoop at 7:53 PM on February 1, 2012


In his accompanying letter, Zuckerberg laid out the principles of Facebook's organzation, describing it as "The Hacker Way":
the vast majority of hackers I’ve met tend to be idealistic people who want to have a positive impact on the world.
This hacker way and its five core principles - Focus on Impact, Move Fast, Be Bold, Be Open and Build Social Value - are already being contrasted with Stephen Levy's "Hacker Ethic", with its focus on freedom of information and sharing, with discussion on how they might interact.
Zuckerberg thinks his company epitomizes "the Hacker Way"? The majority of "hackers" I'm aware of loathe facebook.
posted by delmoi at 7:58 PM on February 1, 2012 [2 favorites]


Well, a company run by hackers, for hackers probably wouldn't make for a particularly enticing IPO.
posted by dixiecupdrinking at 8:08 PM on February 1, 2012


The local 10 o'clock news last night about this, with the focus on how it will be a boost to the local economy - especially if you sell real estate or fancy cars.

The BMW 328i is Santa Clara County's version of the Corolla.
posted by Talez at 8:10 PM on February 1, 2012 [1 favorite]


Ain't that the fuckin' truth. Can't say I'm looking forward to even more douches driving their new Beemers on 280.
posted by rtha at 8:44 PM on February 1, 2012 [2 favorites]


Can't say I'm looking forward to even more douches driving their new Beemers on 280.

Hey!
posted by asterix at 11:54 PM on February 1, 2012


If they could dilute the negative associations of the word 'hacker' I am all for it. Does anybody besides googlezoomer want to make a case for going in? I ain't touching that stock with a ten foot pole.
posted by bukvich at 6:41 AM on February 2, 2012


Hey!

Heh. My wife bought a BMW 328i. I don't particularly like the auto box on it but it's a nice car to drive. Being able to get onto I-280N from Steven's Creek and rapidly overtake those idiots that just have to try and get on the freeway at 45mph is nice.
posted by Talez at 12:45 PM on February 2, 2012


See, I don't worry about (or even notice) non-douches who drive BMWs, because they're not driving like douches. Unlike the guy this morning who was trying - and failing - to go 30 mph over the flow of traffic, which meant a lot of last-second lane-changing assholery. He cut me off once changing lanes, and tailgated me insanely once (I'd picked the better lane ha ha ha). We ended up getting off at the same exit and last I saw him he was tailgating some other poor person, all while looking at his phone.

He was driving a Jag, FWIW.
posted by rtha at 1:11 PM on February 2, 2012


Facebook's 'man in the middle' attack on our data
posted by jeffburdges at 4:12 PM on February 6, 2012


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