The Mark of a "Facebook Era"

Facebook Goes Public
Tuesday, May 29th, 2012
This past Friday, Facebook, one of the top 20 biggest brands in the world, went public.  It joined the NASDAQ stock market with an Initial Price Offering (IPO) of $38.00 per share, one of the largest in history.  Despite Facebook’s worldwide renown however, the stock has had a shaky start in its first two days of trading.  Because of Facebook’s widespread popularity, incredible growth, and astounding success over the past years, traders expected the stock to increase in value.  Many quandaries, however, such as a delayed opening, high initial IPO and last minute change in IPO, and confusion with stock prices hindered its success. 
Before trading commenced, Facebook was on an unbeaten path.  Its IPO was the third biggest in the United States, perhaps too high.  This high value may have seemed too high or too risky for potential buyers, thus decreasing the stock’s initial public reception.  In addition, this abnormally high IPO may have been strenuous for the NASDAQ trading systems to deal with, which may have affected trading.
The oddity of Facebook’s public opening began when its lead underwriter requested a delay in its opening.  After this delay, traders were notified that the IPO was raised to $42.00 per share.  When the stock was officially opened for trade, there was delay and confusion in the exchanges.  People traded the stock at varying mistaken values and did not receive immediate confirmation of their trades.  In total, this fiasco affected and estimated thirty million orders.  Some traders overconfidently expected that the share value would increase by ten to twenty percent on the first day.  The issues stated above however marred this ambitious desire.
In addition to the numerical setbacks of Facebook’s stock, many people have criticized the stock’s potential to increase in value because of the company itself.  They pointed out that Facebook does not provide steady profits because the company does not actually produce any goods.  It is a service-based company that only generates revenue through advertisements.  This fact shows a weakness in the company that may have repercussions in its future.
Despite the issues, the Facebook stock is not a complete bust.  Over 571 million shares were traded on Friday, the value increased by $0.23, it still remains a successful multibillion dollar company.  The stock has not been a total success, but only two days have passed in trading, so there is plenty hope that the stock will succeed in the future. 
When observing this phenomenon, one cannot help but wonder what motivated Mark Zuckerberg, Facebook’s CEO and creator, to make it a public company.  Money was not an issue for the company, as its holdings currently exceed $105 billion.  Promotion was almost definitely not a motivation, as it already has 900 million+ members.  On Friday May 18, Zuckerberg gave enthusiastic insight as to the motivation for going public and stated that “our mission isn’t to be a public company. Our mission is to make the world more open and connected.”  Perhaps this statement sums it up.  Going public is simply a part of developing the company and connecting people around the world.  The statement is a bit vague, but fits consistently with the company’s ideology to connect people through the Internet.
Although Facebook’s public stock has gotten off to a weak start, it is too early to view this as a full indication of the company’s future success.  Viewing the past success of suggests that the company there is still ample hope for the company to succeed, especially in light of the life changing innovation and implications is has created.  Facebook has literally altered the lives of hundreds of millions of people, and its lasting impression will likely continue to define our generation and global society.  When a company has this much influence, it only seems possible for it to succeed as time continues.