Facebook’s Message to Investors: Look to the Stars


Facebook has been sending a loud and clear message to investors: Pay more attention to the value it will provide over the long term, and don't get too caught up in how big it opens when it goes public. This messaging strategy is being used to moderate lofty expectations for an IPO that will most likely set a new record within the technology sector. Facebook said on Feb. 1 that it will look to raise $5 billion for its upcoming IPO in the spring or summer of 2012.

There is no doubt about Facebook’s potential for growth; all you have to do is take a look at its listed statistics. The social network has 845 million users; 485 million daily users; generated an annual revenue of $3.7 billion in 2011, which is an 88% increase over 2010; and a 2011 net income of $1 billion—numbers Facebook CEO Mark Zuckerberg surely wants potential investors to keep in mind when they consider buying shares in the company.

In a statement directed at prospective investors, Zuckerberg tried to downplay the buzz surrounding Facebook’s eventual valuation. He said when he created Facebook, he did not imagine it as a business entity—he saw and continues to see it as a way to connect people and create meaningful relationships. “Simply put, we don’t build services to make money; we make money to build better services,” said Zuckerberg.

In the wake of the recent IPOs for Zynga and Groupon, both of which opened at higher-than-expected values only to underperform afterward, it makes sense that Facebook would want to temper outsized expectations.

Facebook might not deliver on the $100 billion valuation predicted by many, but that doesn’t mean it won’t be valuable going forward. After all, just look at those numbers.

Follow Sahil Patel: @sizpatel
 


Comments Off



Deals of the Week

$150 Off PR News' Social Media Summit

socialmedia201602-180x150Join PR News in Huntington Beach, CA on Feb. 26 for the Social Media Summit, where you'll be immersed in real-world, tactical case studies from brands, nonprofits and agencies and get takeaways in pulling and analyzing social media data; emerging social platforms and apps and so much more. 

Use code “150” at checkout to save $150 o the regular rate.

$50 off the CSR & Green PR Guidebook

csr_vol7_print_digital-thumbPR News’ CSR & Green PR Guidebook, Vol. 7 captures best practices in communicating the positive relationships that organizations are building with their communities of interest. This six-chapter guidebook connects the dots between the effective communication of positive social contributions and corresponding improvements in bottom lines.

Use code “50off” at checkout.

Save $100 on a PR News Subscription

cover5.18

 

Let PR News become your weekly, go-to resource for the latest PR trends, case studies and tip sheets. Topics covered include visual storytelling, social media, measurement, crisis management and media relations.

Use code “SUBDEAL” at checkout.

Comments are closed.