Facebook Status Update: Facebook Filed for IPO

Only 8 years old social networking giant Facebook finally filed documents for its initial public offering last Wednesday. Facebook authorities filed the application online to Securities and Exchange Commission in Washington and will begin trading at Wall Street in the May 2012 if all goes as planned.

Facebook has not announced the number of shares  offered and the price of each share. However, the company hopes to raise an amount of $5 billion through the initial public offering. According to the filing details, the net profit of Facebook in 2011 was $1 billion on sales of $3.7 billion. An estimate shows that Facebook has a stock worth $100 billion. The complete IPO filing details are available on official website of Securities and Exchange Commission.

Comparing to the other Giants of this trade like Google, many specialist are directing questions like, “Can Facebook meet the inflated expectations?” & “Can it prosper as a public company when every quarter’s progress will be monitored?”

Why is it Going Public?

For providing the security to public investments, a company having more than 500 investors has to made available or disclose its financial records to the Securities and Exchange Commission. When a company sells its stock or share for the first time to raise funds is called Initial Public Offering.

Who Founded Facebook:

Mark Zuckerberg, now 27, founded Facebook at Harvard University in Feb 2004. Since then it has been growing rapidly with 845 million active users today.

Zuckerberg published a statement in the form of a letter while company is filing IPO saying, “There is a huge need and a huge opportunity to get everyone in the world connected, to give everyone a voice and to help transform society for the future.” Click here to read full text of the letter on published in The Guardian