With Today’s IPO, Will May 18, 2012 Now Be Known As Facebook Day?

Will May 18, 2012 Now Be Known As Facebook Day

Facebook… love the social network or hate it, finally went public today. Many investors are running wild to get their hands on some of the newly minted shares of the social media behemoth. Shares were set to open up at $38 a share, and according to CNN, the stock started trading at $42.05 when the stock began trading at 11:30ET. Shares are expected to jump much higher in the early going.

Some of the news I have heard today say that buying Facebook is a suckers bet. Big corporations and the rich get access to the stock first at the lower dollar amount, and turn around and sell it back to “the people” at an inflated price. I am sure there is a lot of that going on, but over all I think this is great for Facebook, Zuckerberg, and all the Facebook employees that will become millionaires today. In fact, I stand up and applaud… (and secretly wish I would have thought of it!… oops, guess that is not a secret now.)

The future of Facebook as a public company is what intriges me. Some people compare Facebook to Apple, but Apple has a definite product they are selling, not to mention a rabid fan base. What is it Facebook sells to consumers? Sure they have the game network, as well as the paid advertising platform… but at the end of the day, what will make this company worth the expected $104 billion dollars to you and me? And how does the love hate relationship users of the platform have, in regards to privacy, come into play?

I’d say the closest comparison to Facebook in the stock market world would be Google. Google makes most of their money from advertising… but they have jumped into consumer products with the Android platform etc. Will Facebook eventually come up with a product or service that people will want to actually buy? Or will Facebook even need to? Time will tell I suppose.

According to CBS news, today Facebook will be the 23rd largest company in the U.S. (as measured by stock market value) putting Facebook ahead of shopping giant Amazon.com. However, Facebook ranks 909th in terms of annual sales globally. Pretty interesting don’t you think?

So, for better or worse, today may very well be known as Facebook Day.

What are your thoughts… will you be buying shares of Facebook? Do you think the need to pander to investors will help, or hurt the social giant? Let’s keep the conversation going below in the comments!

Until next time…  Doc

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8 Comments

  1. Cidem says

    Just to think Yahoo could have bought Facebook for $1 billion in 2006. How dumb do they have to feel now??? One could ask, who would have known? Well… if you tracked Facebook’s growth closely you would have known it will come to this (huge IPO). Good luck Facebook!. Sorry Yahoo – pack your bags….

    • iGoByDoc says

      Yeah, Yahoo has to feel pretty dumb for sure. But, on the what-if side of things, one wonders if Yahoo would have mis-managed it. Maybe Facebook would not be as popular today?

      Thanks for the comment!

      Doc

  2. says

    i really don’t get the commercial potential of Facebook, unless we’re speaking about branding/brand awareness/interaction. Most of the ads are not localized (I’m in China with VPN set to another Asian country) and still get ads from “Buy a house in the US” (on top of that, I never lived in the US). The big advantages of Facebook are that profiles are personalized (few people use nicknames) and that the “Like” function gives the chances to direct marketers to target their audience. It seems that there is something missing in the equation. They could do a lot, I mean a lot, better. As we speak their commercial potential is weak, unless the Facebook page is used by a company doing events and the like. Facebook obviously doesn’t get what marketing is. Surprisingly, I have seen a very successful company interacting with people on their product: juice. But they’ve already been in business for quite a while. Facebook’s IPO is a bubble. 

    • iGoByDoc says

      It will be interesting to see how Facebook plays out as stock over the next few months or years. It was interesting to see how the stock performed. It did not skyrocket as many expected. As far as the ad goes that you are getting, one would assume that is part of the Facebook ad targeting platform. Either the advertiser has no idea what they are doing, or maybe they are targeting your country?

      For me, where Facebook, as well as many other social platforms, is advertising. When I say lack I do not mean for me… I do not like being advertised to on my mobile device, but from a shareholder perspective, Facebook has got to crack this nut, as well as build a decent iPhone application.

      Thanks for the comment.

      Doc

  3. Stock broking says

    i dont think that no body beat the facebook becoz as well as their updation increase as well as facebook user happy and excited….  i belong to small village of india, no body know what is internet but everybody know what is facebook. so i think the future of facebook is brightfull not only  facebook future bright even users also got a opportunity..

  4. Benhhoc says

    “Big corporations and the rich get access to the stock first at the lower dollar amount, and turn around and sell it back to “the people” at an inflated price. I am sure there is a lot of that going on, but over all I think this is great for Facebook, Zuckerberg, and all the Facebook employees that will become millionaires today. In fact, I stand up and applaud… (and secretly wish I would have thought of it!… oops, guess that is not a secret now.)”

    I like it!

  5. David Loney says

    I am very interested in this stock.  It seems much of the controversy about the stock price is that most people do not understand how the company will make money being as they don’t have a product.  I see facebook as having a product and the product is software that allows people to connect amoung other things.  As for the potential revenue facebook can bring in, they have the attention of a huge percentage of the population, that is definitely worth a huge amount of money.  Any one person or company that has that much attention has the ability to influence its followers/customers/users.  Lets face it, it Facebook wants to sell a product it could, they could have an ad on every page of facebook and no doubt could sell a product a million times an hour if they wanted to. 

    • iGoByDoc says

      Hi David,

      Thanks for the comment. It is interesting to see how the stock performed since it went public eh. I agree with you for the most part about what their product is, but attention of the public, while “worth” a lot of money, does not bring in the money. Sure it brings in a good chunk, but it is at the expense of the user experience, old school interruption marketing (ads). People do all they can do to avoid ads. Facebook ads have a history of underperforming, and maybe that is OK. But I think think that the real value of the company, is the information it collects from the user base, and the targeted advertising that businesses are able to do.

      Facebook has to figure out the mobile advertising game if they are going to really succeed… and that includes creating an app for mobile devices that actually works.

      I did hear that Facebook was considering getting into the mobile device market… and that could be a consumer product that people may buy. My guess is they either have to create their own OS, or go with windows as I am pretty sure Google would not offer up Android. Could be a huge win for Microsoft and Facebook.

      You bring up an interesting point about a Facebook product… what would that be?

      Thanks again for the comment.

      Doc

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