Thoughts on the Facebook IPO
Last week was a big week for Facebook. On Wednesday, they filed their papers for an Initial Public Offering slated for May, and predicted to be one of the biggest technology IPOs ever. On Saturday, the company celebrated 8 years in business.
The story of Facebook is a pretty folksy one, having been told once by founder and CEO Mark Zuckerberg himself, and again in an Oscar-winning film, “The Social Network”. Regardless of whether the tool was born from a rejection by a woman (as the movie seems to take the viewpoint of), the network has gained almost 800 million people, and about half of those log in daily.
The journey here has been a tumultuous one, but also one of great success. When the company started in 2004, MySpace was gaining traction, Friendster and Bebo were on the market, and the term “social media” had yet to be coined. Blogging was the term of the day, and that’s how most companies and people managed to maintain a level of “sociality”. Beyond that, everyone still used email.
The first few years of Facebook were mostly limited. To gain an account, you had to initially have had an email with a college. Then the network opened up to high schoolers, and then eventually to people with a regional affiliation, then to anyone who had an email account. Opening it up to everyone invited the concept of spammers, but in this day and age, if you want to be big, there are some things that you simply have to put aside - spam is one of them, unfortunately.
I touched Facebook for the first time in the Fall of 2005. It was late September, and I finally snagged an account. I was exploring MySpace at the time, but did not find much of it - my fears mostly came from design-stupid people who would either fill their profiles with mundane items, upload schizophrenic inducing backgrounds or play music when I landed on their page. I instantly fell in love with Facebook at the time because it was simple, sleek and it made sense. I didn’t know that it would become a crucial part of my career some day.
Fast Forward
Fast forward to February 1st, 2012, when Facebook decides to file its IPO papers. The papers claim that the company will try for a $5 billion dollar IPO, and the company is estimated at $94 billion dollars, with 12% of its money coming from Zynga and the majority from advertising.
My initial thoughts are of great interest. I have yet to review the S-1 in great detail, but the world of social media is about to change. From the definitive entrance of Wall Street and shareholders to potentially charging Facebook Page owners to peddle their brands and wares, social media, the tool best known these days for taking down Egypt, perpetuating the Occupy Protests, and being faster than reputable news sites, the nostalgia and the nuances feel to be pretty much over. My account, to a shareholder, is potentially not just another number, but an advertising unit. Someone to deliver advertising to in pushy ways, clouding the experience that was once enjoyed. Though Facebook claims that it will just continue to make products without bending to the pressures and wills of the investors, the pressure will be there. And it will be strong.
In all, however, the IPO shows that social media is now a permanent part of our lives. Zynga and Groupon’s IPOs merely showed us that social potential was gearing up, but Facebook’s addition into that will put a stamp on something that social marketers have always known, and corporate clickies have always feared: social media is here, here to stay, and there is absolutely nothing you can do about it. Businesses, knowing that Facebook has finally decided to go public, will now have to grapple with the fact that engaging with an audience, producing content and being meaningful to customers at all times is not just an optional job you hand to an intern, but a position you give to someone higher in the organization.
In Closing
Another one of my earliest memories of using Facebook for potential was in the Fall of 2008. I was in Hong Kong, a world away from the United States, studying abroad. It was early November, and it was election day. I sat on the floor of my apartment, my laptop to my right and the television tuned to CNN to hear the latest breaking news.
As the clock struck noon local time, all polls had closed out on the West Coast, and my Facebook feed, then a self updating automated feed, went into overdrive. Barack Obama had won the election, and as he was walking up to the podium, my feed exploded with joy, activity, and raw emotion. Nevermind that the Bush era had come to its close, but rather that social media had for me, fulfilled a potential then - a potential to be used as a communications tool far beyond what the Wall Street Journal, the AP, or any newspaper could offer - that even though news sources could provide me news, my friends could provide commentary, beyond the news, and into an era of relationship based marketing and information.
Come May, this all changes, again.
What are your thoughts on the Facebook IPO? Comment below, send me a tweet @albertqian or email me!
