Lots of the news today is focused on the impending IPO for Facebook in the spring. It’s talk that has been flying around for quite some time but this time it looks like it could actually happen.
According to the Wall Street Journal
The social networking firm is now targeting a time frame of April to June 2012 for an initial public offering, said people familiar with the matter. The company is exploring raising $10 billion in its IPO—what would be one of the largest offerings ever—in a deal that might assign Facebook a $100 billion valuation, a number greater than twice that of such stalwarts as Hewlett-Packard Co. and 3M Co.
If the very recent past of tech IPO’s should teach us anything, it’s that the IPO itself is not for the regular guy and gal. The true benefit of an IPO is for the founders, the vested employees and the investment bankers. If the recent turn for Groupon and LinkedIn stocks (if you haven’t been paying attention both stocks are in the crapper) are any indication after those folks have taken their share (you don’t think they do this for long term investing now do you?) these stocks can turn toxic, no matter what the valuation is.
Not to say this is going to happen to Facebook. In fact, Facebook looks like IBM compared to Groupon. It has spent years building its core framework of 800 million accounts, appears to be making money, doesn’t have a history of financial gamesmanship etc, etc. In other words, it’s not run by someone like Groupon’s Andrew Mason. In fact, of all the companies that could go public, Facebook is the one the makes the most sense. Why? Because it’s a real company. That’s the reason that Google fared so well. There is real meat on the bone.
As marketers though, this IPO talk which we are now faced with hearing for the next 5 or 6 months should be a non-issue. Following how much Facebook is worth and how rich other people will be getting in this process will accomplish nothing other than being a rather useless distraction.
For marketers the story around Facebook is very much the same as it always has been whether it is public or not. Some areas to be watching for:
- Possible regualtion – With the European Commission breathing down Facebook’s neck about how much information they gather on people and how it is used we need to watch to see if any other governments will be taking the same aim at Facebook. The US likes to follow suit in these areas and considering the election year coming up it may be a political play worth the effort for someone. If the regulators want to restrict how much info you can get on Facebook users then your job gets more difficult. Oh and if the European Union collapses in the meantime because they are more concerned about Facebook privacy than paying their bills then this whole discussion could be moot.
- Continued ways to measure the true effectiveness of Facebook ads and campaigns – Like any other social media outlet marketers should be worried about proper measurement of just what they are getting out of their Facebook efforts. Who cares if Mark Zuckerberg is worth a gazillion dollars. Your job that ays your bills depends on how well these things work and not how rich the owner is.
- Whether public company pressure changes how Facebook operates – One piece of fallout from going public could be a change in how Facebook does their business so they can meet the pressures of the quarterly performance circus that is Wall Street. If they are smart they will follow Google’s lead and give no guidance to the idiots on the Street. it will only make running their company more challenging.
What other areas do you think are of real concern to the folks like us that live amongst the commoners? Should you really care about the comings and goings of the Facebook IPO show? I say no. What about you?