Last Friday, Facebook had finally offered its shares to the public in the most anticipated IPO of the year, raising about $16 Billion and making its founder Mark Zuckerberg the richest man ever to wear a hoodie. The initial stock price was set at $38, but by Monday the price dropped to about $34 and is about $33 today. The day of IPO had been marked by delays, technical glitches, lawsuits accusing of preferential treatment of large investors, and by Mark’s wedding to his longtime girlfriend Priscilla Chan. Sure, weddings can be expensive, but raising $16 Billion just to have a wedding? Wow. It is too early to tell if the marriage will be successful, but most experts have already concluded that Facebook IPO was a flop. So here are 10 reasons why Facebook IPO was a flop.
1) Potential investors were too busy playing Angry Birds on Facebook to pay attention to anything else.
2) The IPO underwriter informed only major investors of updated earnings projections because they could not figure out the Facebook’s privacy settings.
3) The investors remembered about the fate of MySpace. And then everyone forgot about MySpace again.
4) An Instagramm picture of the company’s financial report turned out to look much better than the actual report.
5) Facebook did not agree to sell its stock for the Farmville money.
6) The Facebook business model is based on the assumption that more users posting more stuff is better for business. However, the model did not account for the fact that some users should probably be paid to stop posting.
7) When Mark Zuckerberg announced the IPO on his Facebook page, he forgot to change the post setting from “Friends Only” to “Public”.
8) The infallible Wall Street expert JP Morgan expressed confidence that the Facebook stock price will rise sharply.
9) Facebook users thought they could get the Facebook shares just by clicking on “Share” button.
10) Finally, how can Facebook expect me to buy a piece of it for $38, if it can’t even sell me its Timeline for free?