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Tag: ipo

  • Facebook IPO Docs Ready for Approval this Week

    As I reported last week, the Facebook IPO may be delayed a little from its original third week in May projected launch time. Some experts in the industry believe that CEO Mark Zuckerberg may be just too busy with acquisitions and other Facebook housekeeping issues to get the IPO ready on time.

    Today however, All Things D is reporting that the SEC paperwork and S-1 prospectus are ready for approval and waiting on the green light. So we can expect action soon, but given the number of delays we’ve seen already, I won’t jump to any conclusion. The next step is to distribute the paperwork to investors and roll-out the IPO roadshow.

    The IPO is shooting to raise $5 billion for future investments at company, but there has been some debate about the estimated value of the social networking giant. Many savvy business people seemed to agree that Facebook was worth about $100 to $104 billion, but more recently, other professionals have argued that the estimate is a little high and offer a better estimate of $90 billion.

    Of course another issue could cause investors to shy away from Facebook at this moment. Yahoo! recently filed a lawsuit against them involving technology patents. They are claiming Facebook only bought some patents to protect against lawsuits from ones they have already infringed upon in the past. Who knows how ugly this could get. Patent lawsuits seem pretty unpredictable.

    In any event, it looks like the Facebook IPO will roll-out sometime in the very near future. As to the true value of Facebook, we’ll let the investors decide. What will happen with the Yahoo! lawsuit is anybody’s guess. Check back here for more news on the Facebook IPO is it becomes available.

  • Facebook to be Traded on NASDAQ Exchange

    There have been rumors floating around that the big “FB” was still in negotiations to decide which exchange they would have offering their stock in the much anticipated IPO happening in the next couple months. Well, finally it has been confirmed, Facebook will be carried on the NASDAQ stock exchange.

    According to Bloomberg, the ability to be listed on the NASDAQ-100 index was a deciding factor for Facebook. Just announced April 23rd, the NASDQ will shorten its waiting period for addition to the index. Simply put, Facebook could be included in the index in as little as 90 days as opposed to the previous “seasoning” period of over one year.

    Experts who spoke with Bloomberg claim that going into the index, “would help the trading volume of Facebook dramatically”. The decision to change the index waiting period at NASDQ, according to Bloomberg sources, was made in order to keep it more relevant and to include the biggest companies sooner.

    There is also speculation that Facebook may eventually expand its $5 billion IPO to as much as $10 billion. Again though, this is just speculation, it has not been confirmed in any way.

    As you would expect, we will be watching for any developments in the Facebook IPO. As we reported yesterday, even the May IPO date is still up in the air. Acquisitions and other housekeeping issues at the social networking headquarters may be taking priority over getting IPO up and underway.

  • Facebook Rumor Mill: IPO Pushed Back To June

    Yes, it seems like it has been forever since Facebook announced its much anticipated initial public offering (IPO). I am sure most of us would have thought it would have happened already, and some probably think it did, but no, we are still waiting. Zuckerberg and his social platform seem to be endlessly altering and adding to their SEC filing statement, and now the May 7th offering date looks like it may not happen either.

    According to CNBC, CEO Mark Zuckerberg’s distraction with other business dealing like actually running Facebook and acquiring other entities has been putting the groundwork for the IPO on the back burner. They believe the IPO might not actually see the light of day until late May, early June.

    While it has been popular for others to speculate about the exact date for the IPO, I think almost everyone agreed this was subject to change at any time. At the time, most seemed to think it would happen on the third week in May, but if the rumors about Zuckerberg have ant weight to them, it’s looking like the fourth week in May or the first week in Jine.

    Perhaps we should just wait for July 4th. That gives Facebook’s crew plenty of time to prepare and we can declare it a national holiday, oh wait, it already is. As i’ve said, these are only rumors, and nothing has been substantiated yet. Nothing seems to be quite set in stone when it comes to Facebook’s IPO.

    In fact, there’s even rumors the platform battle between who will carry the “FB” stock hasn’t been settled. Will it be NASDAQ or NYSE. I guess it’s all up in the air. We’ll keep you posted as new information becomes available about the Facebook IPO.

  • Facebook Now Boasts 901 Million Users

    Facebook Now Boasts 901 Million Users

    It’s not like we were unaware that Facebook was approaching 1 billion monthly active users. In their original S-1 filing at the beginning of February, they told us that they had 845 million MAUs, which obviously makes it the biggest social network in the world. But today they updated their S-1, and in it are some stats about where they’ve come in less than three months since the initial filing.

    And as of now, Facebook boasts 901 million MAUs.

    Doing the math, that’s +56 million users in about 11 weeks. We can in no way predict that the growth rate of Facebook will remain at a constant 56 million users per 11 weeks, but let’s just imagine it does, just for fun. In that case, we can expect them to hit 1 billion MAUs well before the end of the year – sometime around early September.

    Facebook also dropped some additional stats. Users now generate 3.2 million likes and comments per day, up from 2.7 million in February. Total friend connections across the network has jumped from 100 billion to 125 billion. And there are a staggering 300 million photos uploaded every day.

    On the financial side of things, Facebook made $1.058 billion in revenue in Q1 of 2012. That’s up nearly 45% from Q1 2011, but down just a bit (6.5%) from last quarter. Advertising accounted for $872 million of their Q1 2012 revenue.

    According to recent eMarketer figures, Facebook’s growth rate is declining, which isn’t really surprising considering how many users they already have. By 2014, it is expected to slow to 3.6%.

    Their much-anticipated IPO is expected to come in May, with the latest speculations pinpointing May 17th as the exact day.

  • Facebook Might File IPO on May 17th

    It has been assumed that Facebook plans to file its IPO sometime in May, and now has reportedly set the 17th of next month as the date, after months of speculation regarding the matter in general. Sources who have access to the dealings of the company have relayed the date, and speculate that as long as the SEC agrees, mid-May should be in order.

    The possibly $5 billion mid-May IPO correlates with earlier reports of Facebook listing on NASDAQ as FB, and is going for a valuation of $100 billion, which some have said too high. Lagging mobile development for the platform might hurt the valuation, though the recent acquisition of Instagram might likewise help.

    So, in roughly a month, the IPO will likely be filed. Facebook has recently disproved Paul Ceglia’s claims of owning half of the company, but there are larger issues that could concern institutional investors like Morgan Stanley and Goldman Sachs – what if Facebook, which in the end is solely based on the retention of users, eventually goes down the same path of Myspace? Though this doesn’t seem likely, if Facebook were to plainly lose popularity amongst its 800+ million active followers, it could become the latest sort of dead content heap.

  • What Will the JOBS Act Do for Startups & the Tech Industry?

    Last week, President Obama signed into law the Jumpstart Our Business Startups Act, more commonly known as the JOBS Act. The White House administration is hoping that small businesses and startups will drive recovery and create new jobs.

    In a press release the White House released, the President said:

    “America’s high-growth entrepreneurs and small businesses play a vital role in creating jobs and growing the economy. I’m pleased Congress took bipartisan action to pass this bill.  These proposals will help entrepreneurs raise the capital they need to put Americans back to work and create an economy that’s built to last.”

    What do you think the JOBS Act will do for small businesses and startups? Please share.

    The bill covers several provisions, but the most prominent one is “crowdfunding.” Under this element, startups and small businesses can solicit the general public for investment, which democratizes funding efforts.

    Michael McGeary, Strategist at Hattery Labs Michael McGeary, who is a strategist with venture capital firm Hattery Labs, worked with lawmakers on this bill and told us that crowdfunding was the “#1 way for direct benefits as the bill rolls out.”

    “It’s gonna make it available for people all over the country to give what they can to a startup they believe in and get equity in return, which will help on both sides,” he said.

    Crowdfunding will specifically help those startups that don’t need millions of dollars but that still need some to get their feet of the ground. McGeary said it would help startups become companies more quickly and also give them more growth potential. He also told us that he expects to see more companies such as Kickstarter and IndieGoGo as the JOBS Act is rolled out.

    While some people have questioned the impact of crowdfunding on traditional funding methods, McGeary doesn’t believe they will be harmed in any way. In fact, he believes they will be enhanced by crowdfunding.

    “Crowdfunding is not going to utterly change that system,” he said. “All it’s gonna do is make it better for more people to get more ideas to the marketplace faster.”

    He went on to say that it would draw in a wider community to what’s happening in the Silicon Valley because more people will be involved. This will furthermore help to create a more transparent startup economy since the community will be bigger and more diverse.

    The JOBS Act will also lighten the regulatory hurdles that small businesses must go through in the expansion of “mini public offerings” and the creation of an “IPO On-Ramp.” These provisions will not only eliminate forced IPOs, but it will also speed up the process for businesses to grow at a faster rate.

    Despite the strong bipartisan support, there has been some opposition to the bill. In a post in Rolling Stone entitled “Why Obama’s JOBS Act Couldn’t Suck Worse,” Matt Taibbi discusses the fraud and scams that could take place in the stock market as a result of the law:

    “In fact, one could say this law is not just a sweeping piece of deregulation that will have an increase in securities fraud as an accidental, ancillary consequence. No, this law actually appears to have been specifically written to encourage fraud in the stock markets.”

    The Huffington Post also pointed to the dissatisfaction of the labor parties suggesting that the White House chose the tech community to alleviate concerns raised over the SOPA outbreak in January. Others have indicated that the law could open the door for weak IPOs.

    McGeary, however, told us that he does not believe the negatives outweigh the positives. According to him, the people who are advocating the law are adamant on its success and, therefore, are determined to keep fraud away.

    “There’s no investment without risk,” McGeary said.

    “If bad actors do enter the system and fraud does start to proliferate through the crowdfunding system, there’s gonna be a movement afoot in Washington very quickly to make sure that any regulations that have to be changed or augmented in that way, will happen swiftly,” he added.

    While McGeary believes the JOBS Act is a “great first step,” he believes that more needs to be done in terms of the startup community, especially in the areas of long term STEM education and spectrum and broadband patents.

    The SEC is currently requesting feedback on the law, as it contemplates potential regulatory measures.

    Do you see more concerns or benefits with the JOBS Act? Let us know in the comments.

  • Facebook IPO: Facebook Will Reportedly List As FB On NASDAQ

    Word is that Facebook is shooting for a $5 billion IPO in May, and now we know which exchange host it.

    The New York Times is reporting, citing “people with knowledge of the matter,” that Facebook has chosen NASDAQ for its IPO, and will ist under the ticker symbol FB. According to the report, Facebook has already notified the exchanges.

    CNBC appears to confirm the news separately:

    @CNBC
    CNBC    Breaking: Facebook to list on the @Nasdaq. 29 minutes ago via TweetDeck ·  Reply ·  Retweet ·  Favorite · powered by @socialditto

    Groupon, whose stock just hit an all-time low, also trades on the NASDAQ as does long-time Facebook partner Zynga, and other major tech companies like Google, Apple, Microsoft, Amazon, Intel and Yahoo. Other recent high profile IPOs like Yelp, Pandora and LinkedIn have gone to the NYSE.

    Watch our recent interviews with analysts about the implications of the IPO:

  • Cafe Press Inc. Announces IPO Stock Prices

    Cafe Press Inc. Announces IPO Stock Prices

    Yesterday, CafePress Inc. announced a price for their shares in their upcoming initial public offering (IPO). 4,500,000 shares will be offered at $19 per share and will be available on the Nasdaq Global Select Market beginning on March 29, 2012 under the ticker symbol “PRSS.”

    J.P. Morgan Securities LLC and Jefferies & Company, Inc. are listed as joint book-running managers for the offering. Cowen and Company, LLC, Janney Montgomery Scott LLC and Raymond James & Associates, Inc. are listed as co-managers.

    About CafePress Inc:

    “CafePress is The World’s Customization EngineTM. Launched in 1999, CafePress empowers individuals, groups, businesses and organizations to create, buy and sell customized and personalized products online using the company’s innovative and proprietary print-on-demand services and e-commerce platform. Today, CafePress’ portfolio of e-commerce websites include CafePress.com, CanvasOnDemand.com, GreatBigCanvas.com, Imagekind.com, and InvitationBox.com.”

  • Facebook Shrinks Ads To Cram More Ads Onto Your Page

    As if it wasn’t enough for Facebook to start affixing ads in every nook possible, now it appears that the social networking site is changing the requirements for ads so as to push even more ads into the extant ad-laden areas. According to a new document laying out the policy, “Premium and Marketplace Product: Specifications and Best Use Cases,” ads will not only have a lower maximum character count but also smaller image specs. Anyone wanna take a guess as to why?

    Several types of Marketplace ads stand to be affected by the new size requirements, such as ads for Likes, Apps, Events, and Standard ads that drive traffic offsite. Formerly, Facebook required images in ads to be 110 x 80 pixels and restricted text to 135 characters. The new specifications, which will take effect on March 31, will limit ad images to be 99 x 72 pixels and text to 90 characters. Inside Facebook noticed that, although the new specifications aren’t technically in place until the end of March, Facebook has already started automatically resizing ad images to 99 x 72.

    The new specifications will reduce the size of ads enough that, instead of squeezing six ads into a sidebar, Facebook will be able to cram seven ads into that allotted space. See the scale of images below using the WPN logo. While there isn’t any text included next to these images, it should give you an idea of how the new specifications will affect the amount of ads that can be fit into a space.

    This recalibration of ad sizes in order to fit more ads onto a Facebook page accompanies the company’s decision to begin including ads into users’ feeds (so as to monetize the mobile Facebook experience), which was announced at fMC last month. Ahead of Facebook’s initial public offering, the company seems to be racing to make every single aspect of the site a potential source of profit. I don’t know why they’re trying to be subtle about it, though – why stop at seven when you could shave off a few more pixels and wallop users with eight?

    The thing is, Facebook was already wildly profitable but it acts like its still got a ton of convincing to do for investors to start throwing money into the company. Unfortunately, Facebook’s tactic for convincing those investors carries the consequence of turning your Facebook newsfeed, profile, and all your Facebook relationships into piñatas that they plan to beat to death until some money shakes out of it.

  • Facebook’s Zuckerberg Absent From Analyst Meeting

    Facebook’s chief executive Mark Zuckerberg skipped a meeting with analysts and bankers held at the company headquarters in Menlo park, CA on Monday, according to those familiar with the conference. David Ebersman, Facebook’s CFO, stated that Mr. Zuckerberg preferred to focus his time on developing the service rather than play a role with such analysts, according to insiders.

    Monday’s meeting came almost two weeks after Facebook put together a group of 31 underwriters to help sell the IPO, which at almost $10 billion will be the largest Web IPO ever in the U.S., expected to be completed by sometime in May. Facebook plans to pay a below average fee to underwriters of the stock sale at 1.1%, which is roughly half the average fee for deals $5 billion or more, over the past 5 years, as reported by Dealogic. Wall Street analysts say that the low Facebook fee is indicative of the prestige value of the deal – though the fee wouldn’t be as low as the less than 1% the U.S. government paid for the stock sales of General Motors Co.

    Monday’s three hour meeting was presided over by Ebersman and chief operating officer Sheryl Sandberg. General counsel Ted Ullyot, vice president of engineering Mike Schroepfer and vice president of product Chris Cox were also present – Zuckerberg’s absence pointed to the notion that senior executives at Facebook have yet to make any decisions on his ultimate role as the company sells shares to investors.

    Also mentioned at the meeting was Facebook’s claim that its users top Google+1 users by as much as 140 times, regarding time spent on their respective sites. Also, the company mentioned it would have a response to a patent lawsuit filed by Yahoo Inc. within a few weeks.

  • Zynga Planning Secondary Offering To Prevent Share Dumping

    Zynga went public last year with a $1 billion IPO that set the social games developer up for a year of rising profits and increased customer base. It seems its shareholders have other plans.

    Bloomberg heard from two separate sources that Zynga will be holding a secondary offering of shares to the shareholders. This would extend the “lock-up” period where shareholders wouldn’t be able to sell.

    This news comes on the heels of Zynga’s stock being downgraded by J.P. Morgan. It wasn’t exactly a bad thing that the stock was downgraded. At the time, J.P. Morgan said they were positive about the prospects of the newly announced Zynga platform, but it would take time for it to take hold.

    The downgrade could have had an effect on shareholder’s expectations nonetheless. They could be wanting to sell now instead of taking a chance in a market that some people think may just be a fad.

    As of writing, Zynga’s stock is down 38 cents to $13.38 per share. Looking at Google Finance, we can see Zynga’s stock take a visible drop after the news of the secondary offering. It wasn’t a big drop, but it was a drop nonetheless.

    Zynga Planning Secondary Offering

    The expanded “lock-up” with a secondary offering could give Zynga the time it needs to show the potential of their Zynga Platform. Launching a new platform is never kind to any company’s stocks so this could be the best option the company has at this point.

    Regardless, Zynga will bounce back. There are some companies that one may consider too big to fail. Considering that Zynga generated about 12 percent of Facebook’s revenue last year, I think they’re pretty safe for the time being.

  • Internet IPOs Get Their Own Top 10 List

    Internet IPOs Get Their Own Top 10 List

    We here at WebProNews love it when Internet companies go public, and not just because it provides us much needed news on what may be a slow news day. It’s just fascinating to see how much these tech start ups are worth and how they plan to grow their business.

    This year alone has already seen a massive IPO from Facebook in February, and Yelp started trading this month. Even though Twitter is remaining mum on the subject, they will either file this year or next.

    This infographic from French tech Web site Vincentabry shows the top 10 Internet IPOs made over the past 10 years. As expected, Facebook is at the top with their massive $5 billion initial offering. It’s still surprising to see after all these years, however, that a company hasn’t overtaken Google to reach the number two spot.

    It’s also worth pointing out that half of the companies on this list filed their IPO in 2011. It may be indicative of an increased push for these start up companies to go public before they lose their momentum.

    Tech IPO Top 10 List

  • Facebook Gets $8 Billion Line of Credit

    Facebook Gets $8 Billion Line of Credit

    As part of some strategic moves Facebook is making ahead of their IPO, the company has received financing to the tune of $8 billion.

    The loans include a $5 billion revolving line of credit and a $3 billion 364-day bridge loan. This credit line will replace the companies current $2.5 billion revolving credit line used for general business purposes. The $3 billion bridge loan will be used to cover taxes for Facebook employees’ restricted stock units. Financiers include heavy hitters, JPMorgan Chase & Co., Morgan Stanley, Goldman Sachs Group Inc., Bank of America Corp. and Barclays PLC.

    As part of the deal, Facebook added 25 new underwriters (bringing the total to 31) to its updated IPO filing, including Citigroup Global Markets Inc., RBC Capital Markets LLC and Wells Fargo Securities LLC. (Underwriters buy the IPO securities from the company and resell them to the public.)

    According to the updated filing, the $5 billion line of credit will be used for working capital and general purposes. It may also help with potential litigation costs. So far Yahoo has asked Facebook to license technology they believe to be covered under their intelectual property, threatening suit if the matter is unresolved.

    Yahoo may not be the only ones to have legal issues with Facebook. According to their SEC filing, “We presently are involved in a number of lawsuits, and as we face increasing competition and gain an increasingly high profile, including in connection with our initial public offering, we expect the number of patent and other intellectual property claims against us to grow.”

    Facebook made about $3.71 Billion last year, mostly in advertising. The company is marketing to an estimated 845 million monthly active users.

    Investors are still strong on Facebook, estimating the value at around $100 million. Facebook hopes to raise $5 Billion in sales of its IPO shares, potentially making this the largest internet IPO to date.

  • Are You High on Yelp?

    On Friday, popular online review site Yelp began trading on the New York Stock Exchange. The company had a successful first day with shares jumping from $15 per share initial pricing to nearly $25 per share, making early investors very happy.

    While the shares dipped 14 percent yesterday in the company’s second day of trading, some fluctuation is to be expected in the early days of trading. However, one can’t help but wonder if the high about Yelp will continue or diminish.

    Can Yelp meet investor and consumer expectations going forward? Let us know what you think in the comments.

    While Yelp has experienced significant growth since its launch in 2004, the company has also experienced its share of criticism, which is the reason people are questioning its future. Most people associate Yelp with restaurant and other business reviews, but it is actually an Internet advertising company. In other words, it competes with the likes of Google and Facebook.

    As we know, this marketplace is very competitive and is growing. Foursquare is even breaking into the review space by allowing users to offer local recommendations and tips after they check in to places of business.

    For Yelp, this means that it has to defend its position. The company has had a rough road in this sense as it has been accused of ripping off the small businesses that advertise through it. Rocky Agrawal on VentureBeat wrote:

    “At a time when much online advertising is being sold for 60 cents per thousand impressions (CPMs), Yelp is charging some local advertisers $600 per 1,000 impressions.

    That’s not a typo. Yelp is charging small businesses 1,000-times the standard online CPM rates for local ads that appear on Yelp. Even when compared to its own ads for national advertisers, the company is charging a 100x premium.”

    Unfortunately, for Yelp, many of its users feel that Agrawal presented an accurate portrayal of how Yelp’s advertising model works. In a follow up article written by WebProNews CEO Rich Ord that focused on “defending online advertising,” we received numerous comments similar to this one from AJ:

    Is Yelp misleading its advertisers? If so, how? Please share you experience with us.

    Francis Gaskins, President of IPODesktop In addition to these ongoing advertising concerns, there are also other issues regarding its advertisers and the economy. Francis Gaskins, the President of IPODesktop, told WebProNews:

    “In this flat-lined economy, customers that Yelp deals with are not experiencing a lot of growth, so they have to claw and fight for every ad dollar that they get.”

    This information raises some big red flags for investors in terms of long-term profitability, which is another questionable area of the company. Yelp has always struggled with making money, and the following chart shows that the company is actually losing money.

    An even greater red flag for analysts and investors, however, is the fact that Yelp relies on its competitor Google for traffic, which, of course, ultimately means that it depends on it for revenue as well. According to Yelp’s S-1 filing, the company revealed just how dominant of a role Google plays in its business:

    “Google in particular is the most significant source of traffic to our website accounting for more than half of the visits to our website from Internet searches during the year ended December 31, 2011.”

    Incidentally, Yelp has taken a particularly outspoken stance against Google claiming that it shows favoritism toward its own products in search results. The filing also stated:

    “Google has removed links to our website from portions of its web search product, and has promoted its own competing products, including Google’s local products.”

    Yelp’s stand against Google is similar to that of FairSearch.org, which is an organization made up of various companies that believe Google has monopoly power. The group and Yelp are working to encourage policymakers to take action against the search giant in order to, based on information from FairSearch’s site, “protect competition, transparency and innovation in online search.” Yelp has even testified toward this effort, but at this point, the government has not acted.

    When WebProNews spoke to Gaskins about these issues, he equated it to Demand Media/Google situation. If you remember, the companies had a deal where Google directed searches to Demand Media’s eHow platform. In Google’s infamous Panda algorithm update, this all changed.

    “I don’t know whether the people buying the stock… at $25 or $24 realize that Google can turn off half their revenue faucet by changing the algorithms and putting their own searches up there,” said Gaskins.

    He went on to say Google could easily do this since it is a private enterprise that controls its own products. As he explained, Google doesn’t need to worry about what could happen to Yelp.

    However, it is these concerns that have Gaskins and other analysts qualifying Yelp as a risky investment. Rick Summer, an senior stock analyst, recently wrote why his firm Morningstar wasn’t applying for Yelp’s IPO:

    “Unfortunately, the company faces challenges translating the small advertising budgets of local businesses into profitability, as about 70% of ad revenue is eaten up by sales and marketing expenses. Although we ultimately expect operating leverage and resulting profitability, success is far from certain.”

    It’s clear that Yelp has several challenges to overcome, but only time will tell if it can prove its naysayers wrong. Do you think it can? We’d love to hear your thoughts in the comments.

  • Facebook Mobile Apps Ads: One More Way Users Increase Facebook’s Riches

    During Facebook’s fMC keynote address, Mike Hoefflinger announced several new tools available to businesses that will increase the amount of interaction they have with their Facebook fans. The tools – Pages, Offers, Premium for Facebook, and Reach Generator – look to seriously step-up the amount of exposure ads get on Facebook.

    Hoefflinger explained how businesses that use Premium for Facebook (basically, those who pay for the upgrade) will be able to create stories similar to regular Facebook users and then publish them. The stories will appear in news feeds similar to how brands’ updates have been appearing, only now businesses will have more options as to how they appear in their fans’ feeds. In businessese, this means that businesses will have more tools to aggressively hock their brand to Facebook users who like their product.

    If you’re a Twitter user, you likely have seen promoted tweets appearing in your stream that look like this:

    Facebook aping that trick is not exactly the newest thing on the block. However, the thing about the launch of Premium for Facebook isn’t what Mike Hoefflinger said – it’s what he didn’t say. Or, rather, what he merely left for interpretation.

    Think about where you read your news feed and what you see from each location. You read it on a computer or you read it on a mobile device, either a smartphone or a tablet. When you access Facebook from your computer you see the requisite sidebars of advertisements recommending you become some hipster drug counselor or trying to sell you a Lexus.

    However, in the mobile app version of your newsfeed, all you see are updates from your friends or organizations you follow. It’s been a pretty clutter-free experience of Facebook, free of the aggressive onslaught of advertisements that seem to crowd the site.

    Facebook noticed this freedom of advertisements you enjoyed while logged into the mobile app and, perhaps ahead of becoming a publicly owned company later this year, the company wised up and realized that they should drill into this built-in resource of marketing wealth.

    What Facebook’s done here is create a succulent opportunity for businesses to expand how they socially advertise by inserting “stories” about sales offers or promotions into users’ news feed. By integrating the ads into the news feed itself, Facebook has enabled businesses with a way to stealthily implant advertisements into Facebook’s mobile app with as minimal redesign and pervasiveness as possible.

    It’s such a brilliant way of nonchalantly integrating advertisements into the regular user’s experience of Facebook that it’s almost subliminal, not to mention evil genius-level of marketing smarts. Businesses advertise more on Facebook, Facebook makes untold amounts of money from these businesses, and you unwittingly faciliate all of it just so you can keep in touch with your friends.

  • Yelp Could Reach Value Of $840 Million With IPO

    After three months of preparation Yelp has reached a consensus about a value for their stock and is almost ready to go public. Currently they report a target of $12- $14 per share and at that price, value of the company could soar to around $840 million. The shares will be made available on the New York Stock Exchange (NYSE) under the ticker symbol “YELP”.

    Yelp offers recommendations and reviews for visitors on everything from social functions to saturday night entertainment. As of the end of 2011, they attract nearly 61 million unique visitors. A couple of years ago Google was interested in purchasing Yelp, who turned down the $500 million offer.

    Because the timing of the IPO is so closely positioned with the much anticipated Facebook public offering, Yelp will have to be skillful about how it manages the effort. If they can illustrate the strength, vitality, and versatility of their brand, they may prove to be one of the most profitable internet IPOs to date.

    Dave Smith of International Business Times conveys the potential of Yelp and the forthcoming IPO:

    “Yelp will be a great stock to buy, and it’s probably one of the few Internet companies that is actually worth buying.”

    “More so than Facebook, Yelp stock could be extremely valuable because Yelp has so much more room to grow, while Facebook users lament when the platform makes any changes whatsoever.”

    So it will be interesting to see what happens when these stocks finally go on sale, and even more interesting when we see which of them pays off, if not both. I wouldn’t want to gamble on either one of them being a huge money maker right now; the market is very fickle at present.

  • Yelp Sets Share Price For March IPO

    In November we reported that Yelp had filed for its IPO. The original filing stated that Yelp intended to raise $100 million. Yesterday Yelp filed paperwork with the SEC to set its share rpice and the date of its IPO.

    According to the new filing, Yelp is set to go public on March 2, and will trade with the stock symbol YELP. Initial share prices will be $12-14 per share. The company intends to sell 7.15 million shares, raising $100 million.

    Yelp provides local search and review services via their website, yelp.com, and apps for a variety of mobile devices – Android, iOS, BlackBerry, Windows Phone, and WebOS. The service allows users to find a variety of local businesses, check reviews and ratings, see business hours, and more. It also provides navigation assistance to help users find where they’re going.

    Yelp has come a long way since late 2009, when it was in negotiations for a buyout by Google. Yelp has millions of visitors every month and generated nearly $60 billion in revenue in the first nine months of 2011. The vast majority of its revenue comes from advertising. The IPO filing suggests a valuation of $839 million for the company.

  • No Twitter IPO For A Couple Years Says CEO

    Now that Facebook has taken the plunge and filed their S-1 documents, much of the attention has been redirected to Twitter. It’s not like discussion about a possible Twitter IPO is anything new, it just seems to have intensified since the Facebook IPO filing.

    Apparently, all of that buzz is for naught – at least if you ask Twitter’s CEO.

    In emails obtained by CNN, Twitter CEO Dick Costolo had this to say about a possible IPO:

    We don’t want to be public until we have very predictable quarterly earnings growth. We’re not ready to be a public company for a couple years.

    This email correspondence comes in the form of a message to all Twitter staff regarding a limit imposed on the sharing of company shares. Apparently, a rule has existed for about a year that says nobody that holds Twitter stock can sell more than 20% of their shares.

    Costolo wrote that Twitter has to “artificially limit the supply of stock being sold,” Costolo said, “There is one reasonable way to do this: Let everybody with vested common stock sell only some fraction of their shares.”

    Twitter can avoid disclosing their financials if they keep it under 500 shareholders owning one class of equity shares. Once they hit that threshold, they don’t necessarily have to go public – but the majority do.

    Now, it’s important to note that said email correspondence is from August 2011. Things can change in a matter of months. But Costolo’s private comments here seem to mirror his public comments about an IPO made only a few weeks ago at the All Things D “Dive Into Media” conference. There, Costolo refused to directly address the issue of a future IPO, but did say that Twitter’s “going to be really patient about the way [they] build the business,” adding that they “are trying to build a decades-long, lasting business.”

  • For Sale: Empire State Building – Okay Condition

    Would you like to own a piece of American history? Empire State reality, the company who currently owns the massive structure, is going public with the Empire State Building. Their goal is to raise $1 billion with the offering. The capital that is generated will go towards covering the expenses of the IPO, repaying past loans, and financing future acquisitions.

    After the collapse of the World Trade Center during the September 11th attacks, the Empire State Building took back its title of New York City’s tallest building. Millions of tourists visit the building every year. The structure dates back to the depression as it was finished in 1932 and it was previously owned by celebrity entrepreneur Donald Trump. Now investors can own a piece of American heritage and contribute to the preservation of an icon.

    But what is the real value of the building? Head of U.S. REITS at Macquarie Capital (USA) Inc., Rob Stevenson explains:

    “You can’t find too many buildings in this country that are more iconic than the Empire State Building, but if you’re talking about a trophy building — that’s definitely not the Empire State Building.”

    Let’s see what others are thinking about the deal:

    The current owners of the building have invested over $500 million since 2009 in an effort to modernize the building, but the project still isn’t finished and will require a lot more time and money to get it up to par. While commercial real estate in New York has seen a resurgence, it does’t seem like this would be anything more than an investment in American history for stockholders. Nothing about about the property says moneymaker or cash cow; maybe some investors can afford to add a novelty stock to their portfolio, but to me, it doesn’t seem like a wise investment. We’ll see what the future brings.

  • Facebook Can Fire Zuckerberg “At Will”

    Facebook Can Fire Zuckerberg “At Will”

    Mark Zuckerberg is valuable to Facebook as their CEO. That doesn’t mean the company can’t just fire him like any other employee.

    The First Post is reporting that Facebook has the right to terminate Zuckerberg under any reason they see fit, including no reason at all. His tenure at Facebook is on an “at will” basis which means that he could be fired at any time.

    His employment agreement was exposed last month when Facebook filed their massive IPO.

    While everything about Zuckerberg’s employment including benefits and personnel policy can be changed whenever they want, the “at will” employment termination can only be changed after a written agreement approved by the Facebook board.

    The “at will” clause also applies to Facebook COO Sheryl Sandberg. She does, however, have a clause in her agreement that has Facebook reimbursing her for all business expenses. Zuckerberg does not have that clause in his agreement.

    In another interesting clause, Zuckerberg is not allowed to help start up a service that would compete with Facebook during his time with the company. The same clause applies to COO Sheryl Sandberg, CFO David Ebersman and VP of Engineering Mike Schroepfer.

    Interestingly enough, none of the agreements mention whether or not these people could start a competitor if they were to leave the company.

    Zuckerberg is starting out with a base salary of $500,000 so it doesn’t seem that he’ll be leaving the company of his own free will any time soon. Sandberg and Ebersman will have an annual salary of $300,000 each while Schroepfer’s annual salary is set at $275,000. All of them are entitled to an end-year bonus equal to 45 percent or less of their annual salary.

  • Facebook IPO Makes Artist A Millionaire

    About six years ago, a young graffiti artist named David Choe traded his services for a couple shares of Facebook stock. Now that Facebook has announced they are going public, he finds the stocks are worth millions. Who would have thought?

    I guess it’s not all just luck for Choe though. He has painted for some other well-knowns including the co-founder of Napster and President Obama. Supposedly his Obama portrait hangs in the White House.

    Good trade Choe. I hope the money treats you well.