Friending Facebook

Emil Protalinski

Facebook to file for IPO next month (rumor)

By Emil Protalinski | November 18, 2011, 9:30am PST

Summary: We still don’t know when Facebook will file for its initial public offering (IPO). A recent rumor suggests, however, that it could happen as soon as next month.

Facebook may be getting ready to file for its initial public offering (IPO) before the end of the year. That’s the rumor reportedly going around amongst employees of the social networking giant.

A source close to Facebook employees told Business Insider that “a Facebook S1 filing is coming really soon. Possibly as soon as next month. The IPO talk inside Facebook has ramped up the past 6 weeks and Zuck repeatedly has said that it is ‘coming,’ which he *never* said in the history of Facebook.”

Another source close to the IPO process says Facebook has not yet even decided which banks will underwrite the offering. That has to happen before the S1 filing gets written and published.

Facebook co-founder and CEO Mark Zuckerberg has frequently stated, both publicly and privately, that he is against the idea of rushing the company into an IPO. Even earlier this month, Zuckerberg said there is still no expected timeframe for his company’s IPO. Most expect the company to go public next year, possibly as soon as Q1 2012 (conflicting rumors argue there will be a delay).

In December 2010, Facebook announced that it had raised $1.5 billion at a valuation of approximately $50 billion, but that it had no immediate plans for the funds and would simply continue to build and expand its operations. The transaction consisted of two parts: in January 2011, Goldman Sachs completed an oversubscribed offering to its non-US clients in a fund that invested $1 billion in Facebook Class A common stock, while in December 2010, Digital Sky Technologies, The Goldman Sachs Group, and funds managed by Goldman Sachs, invested $500 million in Facebook Class A common stock at the same valuation.

Facebook’s valuation has been all over the place in the months following the investment at $50 billion. Investments have been made valuing the company at $70 billion while sales on secondary markets have priced it at $80 billion. Some look at the growth and see great prospects. Others see a dip in the last few months and think Facebook is doomed. The truth is we can only make predictions on the little data we have, and the rumors are going to just keep coming.

See also: