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Mark Zuckerberg sees $4bn wiped off fortune in Facebook IPO disaster
Mark Zuckerberg sees $4bn wiped off fortune in Facebook IPO disaster
(about 13 hours later)
Facebook founder Mark Zuckerberg has fallen out of the billionaire big league fewer than two weeks after taking the social network public.
Facebook founder Mark Zuckerberg has fallen out of the billionaire big league fewer than two weeks after taking the social network public.
The 28-year-old has seen over $4bn wiped off the value of his fortune since the company went public in an initial public offering (IPO), dropping him off the list of the top 40 billionaires measured by Bloomberg Billionaires Index, a daily ranking of the world's wealthiest.
The 28-year-old has seen over $4bn wiped off the value of his fortune since the company went public in an initial public offering (IPO), dropping him off the list of the top 40 billionaires measured by Bloomberg Billionaires Index, a daily ranking of the world's wealthiest.
Zuckerberg's fortune stood at $18.95bn before the IPO when Facebook's shares were priced at $38. The company's shares hit new lows Wednesday, coming close to $28, $10 below the IPO price and valuing Zuckerberg at close to $14.75bn.
Zuckerberg's fortune stood at $18.95bn before the IPO when Facebook's shares were priced at $38. The company's shares hit new lows Wednesday, coming close to $28, $10 below the IPO price and valuing Zuckerberg at close to $14.75bn.
At that level Zuckerberg lags the 40th placed billionaire on Bloomberg's list, Colombian tycoon Luis Carlos Sarmiento, by $800m. On the day of the IPO Facebook's shares soared briefly and Zuckerberg was worth more than Amazon founder Jeff Bezos or either of his arch rivals at Google, co-founders Larry Page and Sergey Brin.
At that level Zuckerberg lags the 40th placed billionaire on Bloomberg's list, Colombian tycoon Luis Carlos Sarmiento, by $800m. On the day of the IPO Facebook's shares soared briefly and Zuckerberg was worth more than Amazon founder Jeff Bezos or either of his arch rivals at Google, co-founders Larry Page and Sergey Brin.
The company's disastrous IPO has left Facebook and its chief architect with a raft of legal worries. US authorities are now investigating and shareholders have launched class action lawsuits.
The company's disastrous IPO has left Facebook and its chief architect with a raft of legal worries. US authorities are now investigating and shareholders have launched class action lawsuits.
Analysts including PrivCo have predicted that Facebook's shares could fall further as investors worry about the amount of money the company can generate from its huge user base and the shift to mobile, an area where Facebook has warned it is finding it difficult to make cash.
Analysts including PrivCo have predicted that Facebook's shares could fall further as investors worry about the amount of money the company can generate from its huge user base and the shift to mobile, an area where Facebook has warned it is finding it difficult to make cash.
The company's shares took a turn for the worse Tuesday, dipping below $30 for the first time, as traders began making bets on the direction of its share price, also for the first time. Brokers said the most popular of these "option contracts" were those betting on further falls.
The company's shares took a turn for the worse Tuesday, dipping below $30 for the first time, as traders began making bets on the direction of its share price, also for the first time. Brokers said the most popular of these "option contracts" were those betting on further falls.
Jack Ablin, chief investment officer at Harris Private Bank, said the share price, and Zuckerberg's fortunes, were likely to come under more pressure in the short term until the company had found a home with investors with a longer term investment view.
Jack Ablin, chief investment officer at Harris Private Bank, said the share price, and Zuckerberg's fortunes, were likely to come under more pressure in the short term until the company had found a home with investors with a longer term investment view.
"This is a company with huge potential but it's hard to know as yet exactly what it is worth. There is a lack of confidence following the original offering. Ultimately the stock will go to long-term investors and then it should stabilise," he said.
"This is a company with huge potential but it's hard to know as yet exactly what it is worth. There is a lack of confidence following the original offering. Ultimately the stock will go to long-term investors and then it should stabilise," he said.
Comments
55 comments, displaying first
30 May 2012 8:19PM
Why do I get the feeling the Guardian has an agenda when it comes to Facebook's IPO?
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30 May 2012 8:20PM
Isn't that the golden rule - invest for the long term? If you don't have the stomach to ride out the dips you probably shouldn't ride to begin with.
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30 May 2012 8:23PM
Easy come, easy go. Even with at this ridiculous evaluation of his company, he will be laughing all the way to his bank.
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30 May 2012 8:56PM
Only worth $14.75bn - no wonder he didn't leave a tip at that restaurant in Rome!
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30 May 2012 9:10PM
He should be arrested after an SEC investigation
Probably too rich to take to court though
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30 May 2012 9:45PM
Poor wee lamb..
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30 May 2012 9:50PM
Oh diddums only has $14.75 billion now...plenty of information left to sell though...
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30 May 2012 9:52PM
Someone pass me a Kleenex!
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30 May 2012 9:53PM
But mummy, that man (who says he's an emperor) has got nothing on!
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30 May 2012 10:11PM
A company that earns only $5 per user was never worth $100 billion, its was the finical markets wet dream, pity about the premature ejaculation.
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30 May 2012 10:14PM
I thought I saw him in Lidl ealier!
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30 May 2012 10:16PM
It's not really wiped off if it never really existed in the first place!
As for the IPO it's only really a disaster for facebook if these legal issues bite them in the arse. Aside from that, selling shares of your company at a stupidly inflated price is primarily a problem for the idiots who bought them. The initial investors who sold these will think it was anything but.
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30 May 2012 10:22PM
Ha ha ha ha...
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30 May 2012 10:23PM
It must have been the hoodie
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30 May 2012 10:27PM
Child: 'Look mummy the emperor is only wearing a hoodie'
Mother: 'Don't be silly darling'
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30 May 2012 11:36PM
well thats just less taxes hes going to have to pay
hahaha okay stop laughing i mean it.
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30 May 2012 11:38PM
Mark Zuckerberg sees $4bn wiped off fortune in Facebook IPO disaster
Good, the deal was as crooked as Goldman Sachs...
...Hmmmmm, makes sense
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30 May 2012 11:41PM
I say
Good
.. Though I'm sure this is not an entirely unexpected turn up for ol' Z boy
Curse the markets
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30 May 2012 11:45PM
The company's shares took a turn for the worse Tuesday,
On Tuesday.. 'On'
Gah. Damn US correspondents
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31 May 2012 12:02AM
Facebook's future role is very easy to predict - that of a global credit reference agency.
Once Facebook buy companies like Experian and similar credit reference agencies, the share price will see a marked turn around. The whole pressure on the share price, is a method to force Facebook down that route. Bottom line is the markets want access to all that personal data, its the best way to monetarise it and if that means weakening Facebook position initially to get it, thats what will happen.
Yes, people will leave, but the data upto that point is theirs (Facebooks) for picking.
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31 May 2012 12:34AM
I contend that he's really bad at his job. Jet setting off to Europe doesn't really reassure investors.
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31 May 2012 2:06AM
A Ponzi scheme gone busted w/o any bubble. Worked well for Goldmans as usual, but not much for "masses" in our capitalist Casino paradise.
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31 May 2012 2:36AM
You think Suckerberg has it bad, yesterday I imagined I was worth ninety eleven billion gabazillion but today I need to borrow abouta tree fiddy
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31 May 2012 5:34AM
So last month was JP Morgan robbing people and today is FB. The darn line up of thieves and robbers is so long we probably forget about this by next week when the next case comes along and just like we did with JP Morgan. This whole saga (having raised more than 7 large separate civil suits in one day alone) goes to show a much grimmer picture of a stock market that does not need to abide by any regulation whatsoever. How can a company go public without a proper auditing of it';s revenue stream and net worth? A corrupt and unruly market system that stretches all the way from New York to London, Paris, Sydney and Beijing. These people are in fact in control of everything including our governments who do not have the spine to come up with some basic securities regulations in order to put a leash on the markets. Soon this whole ship runs aground...In fact it already has we just refuse to accept the fact.
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31 May 2012 5:39AM
To melat0nin, many major newspapers are reporting the same.
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31 May 2012 7:11AM
stole idea steals privacy by tricking idiots to giving up right to change identities, or be different things to different people, fools idiots into thinking it hip to have the ipo cashes out at 38 dollars can buy stock back when it reaches 7 dollars where it belongs.
Should be illegal. not nice people
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31 May 2012 7:22AM
Zuckerberg's fortune stood at $18.95bn before the IPO when Facebook's shares were priced at $38. The company's shares hit new lows Wednesday, coming close to $28, $10 below the IPO price and valuing Zuckerberg at close to $14.75bn.
Oh woe to Him.....Meanwhile I am working 3 jobs to make ends meet. Do people really care about this walking bag of douche's bad bussiness skills?
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31 May 2012 7:23AM
I feel sorry for him. I've set up a "Just Giving" account for him and suggest we all have a whip round. Money's tight for many of us at the moment, but I doubt many of us have lost 4bn. Poor thing
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31 May 2012 7:39AM
The real reason Facebook shares bombed is simple.
Facebook is crap.
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31 May 2012 8:23AM
Mark Zuckerberg? Someone hand me my flyswat!
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31 May 2012 8:52AM
facebook is good communication tool , zuckemberg is invidious
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31 May 2012 8:56AM
Spot on. Tulipomania all over again.
How can a company such as this have PE Ratio of 100 (at IPO)? Disney makes products that sell, well apart from the occasional duff flick, and has a PE of 16.2. Coca Cola has a PE of 20.0 and I think most of us know what they do. Lunatics, asylum etc.
A fool and their money...
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31 May 2012 9:04AM
I feel that Facbook has become the AOL of the 2010s, because of the fact it was massively overvalued and it paid the price for it!
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31 May 2012 9:26AM
Mark Zuckerberg sees $4bn wiped off fortune
.
Nothing would please me more than to see facebook and apple billionaires lose everything. I use neither products.
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31 May 2012 9:49AM
I think they must be living in a bubble to think that this news would only be being reported in one paper and it is some sort of personal vendetta.
Probably the same bubble that those that bought these shares and thought they would go up in value live in.
Although to be fair, it is the same bubble that Lord Sir Mervyn King and Christine Lagarde live in, so they do have esteemed company, so maybe it is us muppets living outside that bubble that should review what they believe?
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31 May 2012 9:52AM
Why do I get the feeling the Guardian has an agenda when it comes to Facebook's IPO?
Now now, it's not just the Guardian. A brief look around will find quite a lot of people querying whether it was the right time to go public. What with Twitter becoming popular and CRM making blogs a lot easier, Facebook no longer has the impact it once had. Then there are people like me who get fed up with adverts and have added Ad-Block to their browser. And if you also take in to consideration the number of people using their phones to play games using apps rather than Facebook it seems that the stable door may be still swinging but thewre is no sign of the horse. There is also the large number of watchers who have questioned whether any social networking provider can actually rake in the dosh through companies paid-for presence. Several companies had already reverted from paid-for to the bog-standard free version.
So, where do you get the notion that the Graun is a bit anti-Zuckerberg? There's even a Facebook app.
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31 May 2012 10:00AM
EXACTLY RIGHT...Look, AT&T (which I hate for SELLING all of your private cell calls to the N.S.A.) wanted to buy T-MOBILE (GERMAN - owned) corporation for $50,000,000,000. T-MOBILE generates thousands upon thousands of $50+ fees (READ: CELL PHONE BILLS ) per month. What the F--K does FAKEBOOK produce??? And the "INVESTERS" --- more like I.P.O. CRIMINALS--- were bragging that FAKEBOOK was worth $104 Billion; more than 2x the value of T-MOBILE??? WAKE UP CHUMPS!!!!!!!!!
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31 May 2012 10:04AM
stole idea
Sorry, thought you were referring to Mr Gates ;-)
steals privacy by tricking idiots to giving up right to change identities, or be different things to different people,
He doesn't 'steal privacy', if people are silly enough to put their life story up for all to see
and
ignore privacy settings then register with gawdnose how many 'games'
and
then don't look at the privacy settings for those games it's hardly the fault of Zuckerberg is it?
I use Facebook a fair bit but have minimal (pretty much nothing) down for personal info, do not (like you) use my real name and do not (by using AdBlock) get adverts, targetted or not). It's free, most 'free' things come at a price but I don't see Facebook emulating the Mafia by doing me a little favour.
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31 May 2012 10:05AM
THANK GOD the US Department of Justice (with the urging of the smaller cell phone co. SPRINT) BLOCKED AT& T's attempted purchase of T-MOBILE!!!!!!!!!!!!!!
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31 May 2012 10:05AM
WHAT (sorry) what's with the shouting?
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31 May 2012 10:09AM
Are you serious?! I cannot begin to express how poor this writing is.
"Facebook founder Mark Zuckerberg has fallen out of the billionaire big league fewer than two weeks after taking the social network public." No, he has not. Being the 41st richest person in the world does mean you are "out of the big league". I understand the urge to treat billionaires like top trumps, but it's a childish urge. Please grow up.
"The 28-year-old has seen over $4bn wiped off the value of his fortune since the company went public in an initial public offering (IPO), dropping him off the list of the top 40 billionaires measured by Bloomberg Billionaires Index, a daily ranking of the world's wealthiest." "went public in an initial public offering"? Really? Edit much?
"Zuckerberg's fortune stood at $18.95bn before the IPO when Facebook's shares were priced at $38." This is really confused sentence. Before the IPO there were no shares. His "fortune" was only estimated, because the value of a company that is not traded is not easy to assess.
"Zuckerberg was worth more than Amazon founder Jeff Bezos or either of his arch rivals at Google, co-founders Larry Page and Sergey Brin." Who on Earth told you that these people are "arch-rivals"? This is nothing more or less than a bizarre soap opera imposed by your imagination.
Please train this journalist.
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31 May 2012 10:10AM
Nothing would please me more than to see facebook and apple billionaires lose everything. I use neither products.
and for those who do? Are Apple customers chomping at the bit to see the demise of Windows? Is there another social networking site you have a reference for? and don't say 'Twitter' as there is a creeping towards money there as well.
(I am selling Tin foil hats on E-bay)
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31 May 2012 10:20AM
There is no way Facebook is worth $100 Billion, it more than Disney and Bank of America for petes sake!
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31 May 2012 10:24AM
Exactly what time did Mark Zuckerberg cash in? Because I seem to recall that shortly after trading started on the first day, FB shares peaked at $45. Maybe at some point, Zuckers was worth (theoretically) as much as $22.5 billion?
I wonder how much he's worth in cash right now.
Meanwhile, if anyone who bought at $45 is still holding those shares, they've lost 38% of their investment in less than a fortnight.
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31 May 2012 12:04PM
I don't understand much about stocks and shares, it's true, but I really don't understand what's surprising about this. Surely the share price was always going to be highest at the time of flotation? When there was the maximum amount of interest in the company? It was always going to go downhill from there. I suppose the speed at which it's going downhill is surprising, but it's not like they're down to a cent a share. Yet.
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31 May 2012 12:20PM
I don't get this.
Facebook sold a load of it's shares. They sold them for pot loads of cash. Facebook now has pot loads of cash.
The share price going down this week is largely irrelevant to Facebook as they've got pot loads of cash from the IPO in the bank. They can ride out the storm, even if the share price went to zero (assuming they've not exposed themselves to a hostile takeover)....because they've got pot loads of cash in the bank.
The people are angry about this are the stupid speculators who bought high on something that looked overpriced and were looking to offload quickly as the share rocketed.
The 2000 dotcom bubble taught lots of companies to do what Facebook have done. Rather than the likes of Lastminute.com generating £50m or whatever it was then seeing traders treble the value overnight (and walk away with £100m profit that the company never saw), price the IPO according to the demand and bank that cash for yourself.
Assuming they've not lied in the prospectus, it's a great move by them.
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31 May 2012 1:32PM
Boo-hoo. I'm so sad for Zuckerberg right now.
We all need to go over to his Facebook page, right now and give that guy a big Guardian like!!! Like his page like you've never liked anything before.
Like him. Like him. Like him. liiiiiiiiiiiiike him!!!
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31 May 2012 3:12PM
Not necessarily. You have two pressures at the time of an IPO - initial investors and owners want the price to be quite high because they want to see the benefit of their work and investment. People looking to buy in, on the other hand, want the price to be low so they can pick up a bargain and see a rapid profit. When Linkedin floated, it saw huge gains and the complaint then was that the founders and original investors got ripped off by the banks and the stock market who undervalued the company.
In a way you can't win but in this case, an awful lot of people knew that a P/E of 100 was very high and hard to justify. Anyone buying Facebook shares was taking a big gamble and doesn't have any grounds for complaint because it's not like they lied about how much money they make. It's just sour grapes from people who thought they were guaranteed a risk-free payoff from a risky investment.
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1 June 2012 1:25AM
HA HA !
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1 June 2012 7:50AM
likes.
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4 Feb 2012
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Facebook founder falls out of world's top 40 billionaires index as shares hit new lows on Wednesday, falling below $30
Facebook founder Mark Zuckerberg has fallen out of the billionaire big league fewer than two weeks after taking the social network public.
The 28-year-old has seen over $4bn wiped off the value of his fortune since the company went public in an initial public offering (IPO), dropping him off the list of the top 40 billionaires measured by Bloomberg Billionaires Index, a daily ranking of the world's wealthiest.
Zuckerberg's fortune stood at $18.95bn before the IPO when Facebook's shares were priced at $38. The company's shares hit new lows Wednesday, coming close to $28, $10 below the IPO price and valuing Zuckerberg at close to $14.75bn.
At that level Zuckerberg lags the 40th placed billionaire on Bloomberg's list, Colombian tycoon Luis Carlos Sarmiento, by $800m. On the day of the IPO Facebook's shares soared briefly and Zuckerberg was worth more than Amazon founder Jeff Bezos or either of his arch rivals at Google, co-founders Larry Page and Sergey Brin.
The company's disastrous IPO has left Facebook and its chief architect with a raft of legal worries. US authorities are now investigating and shareholders have launched class action lawsuits.
Analysts including PrivCo have predicted that Facebook's shares could fall further as investors worry about the amount of money the company can generate from its huge user base and the shift to mobile, an area where Facebook has warned it is finding it difficult to make cash.
The company's shares took a turn for the worse Tuesday, dipping below $30 for the first time, as traders began making bets on the direction of its share price, also for the first time. Brokers said the most popular of these "option contracts" were those betting on further falls.
Jack Ablin, chief investment officer at Harris Private Bank, said the share price, and Zuckerberg's fortunes, were likely to come under more pressure in the short term until the company had found a home with investors with a longer term investment view.
"This is a company with huge potential but it's hard to know as yet exactly what it is worth. There is a lack of confidence following the original offering. Ultimately the stock will go to long-term investors and then it should stabilise," he said.
