Facebook IPO not happening until 2012
30.07.2010
Facebook is not planning to launch its initial public offering (IPO) until 2012 in order to give itself more time to grow its user base and grow sales, according to reports. The company, which currently has revenues of US$800m, recently secured its 500 millionth user.
According to a Bloomberg report, three people familiar with the subject said that the company intends to use the time wisely, to grow sales, resolve the plethora of privacy issues and ultimately gain more users.
Judging the pace of growth, allied with the growth of the internet and the spread of smartphone devices, it is likely that in two years’ time social networking giant Facebook could reach the 1bn user mark.
It is envisaged that in terms of sales – from online advertising with major brands, classifieds, branding opportunities for businesses via Facebook Marketplace, the Facebook Credits currency and of course the rise and rise of social gaming – Facebook could boost sales from US$800m this year to US$1.4bn next year.
The company, which was started by Mark Zuckerberg six years ago on the Harvard campus, has become the second most visited site on the internet and is to be the subject of a movie The Social Network which will debut in October.
In 2007 Microsoft paid US$240m for a 1.6pc shareholding in the company. Last year Digital Sky Technologies bought a 1.9pc stake in the company for US$200m, valuing it at US$10bn.
Facebook is currently valued at upwards of US$20bn, providing the 26 year-old Zuckerberg a personal fortune of over US$4bn based on his 24pc shareholding.
Pictured: Social-networking kingpin Mark Zuckerberg is estimated to be worth over US$4bn based on Facebook's estimated valuation at present of US$20bn