Facebook Rumored to File for IPO this Week

For as long as Facebook has existed, so has the rumor that the company is about to go public. Late last week, the Wall Street Journal topped off this rumor by saying that it could happen as early as this coming Wednesday, with Morgan Stanley acting as the underwriter. The company is currently valuated at $75~$100 billion, and with this IPO it will offer as much as $10 billion in shares.

The reasons for the company going public at this point are a little hard to surmise, and while I don’t invest I am not sure I’d jump all over this opportunity if I did. From the most basic of appearances, Facebook seems to have reached a peak in potential. About 15% of the planet has a Facebook account, so where are we going from here? What are investors going to see done with their investments?

It’s obvious that Facebook has plans no one on the outside are aware of, but to see Facebook’s revenue stream jump in the next little while just doesn’t seem that likely. And in truth, the potential seems greater for things to begin going downhill, especially given that most features the company rolls out upsets a large percentage of its userbase, making the alternatives (such as Google+) look all the more attractive.

A lot of companies that have seen their valuations soar skyward went public early on in the game, not nearly eight years after their initial launch. None of them waited until they had unbelievable traffic and large generated revenue before going public (at least, few have), so what’s going to become of Facebook’s valuation after this move?

Only time will tell. What I’m more interested in seeing is if people are going to jump all over Facebook shares like I don’t expect them to. But again, I’m not an investor, so I might be way off base with this one.