PALO ALTO, Calif. — Facebook, which has become the largest social networking website with 800 million users since its launch in February 2004 from founder Mark Zuckerberg’s dorm room, is considering raising $10 billion in order to receive a total valuation of $100 billion. If this occurs, Facebook’s perceived value will be twice as high as it was in January. This potential $100 billion valuation could ultimately make Facebook’s worth more than other major companies such as Disney ($61 billion), Amazon ($88.3 billion) worth and Cisco’s ($96.8 billion.)
The Wall Street Journal estimated on Monday, November 28 that CEO Mark Zuckerberg and COO Sheryl Sandberg plan on filing IPO paperwork in early 2012. According to The Journal, Facebook has been drafting a curriculum and consistently speaking with Silicon Valley bankers about raising funds in order to achieve this valuation.
Charlie Rose of Bloomberg Businessweek interviewed both Zuckerberg and Sandberg regarding Facebook he touched upon the company’s future, and specifically, the potential IPO. When asked why the company wants to operate as a public company, Zuckerberg responds, “We’ve made this implicit promise to our investors and employees that by compensating with equity and by giving them equity, that at some point we’re going to make that equity worth something publicly, in a liquid way.” Equity is the main purpose for the company’s expansion, according to Zuckerberg’s response.
Both Sandberg and Zuckerberg are prudent when discussing filing for their IPO paperwork, and give no further indications as to when they want to carry out their propositions. “When we’re ready,” is Sandberg’s response to when the company plans on seeking their $100 billion valuation. In April 2012, however, Facebook will be compelled to publicly disclose its finances to the Securities and Exchange Commission. The SEC requires all companies with more than 499 investors to reveal their financial information. Therefore, more information about Facebook’s valuation and IPO will be exposed this spring.