CorpComms Magazine

So let's talk Facebook, I can't seem to get away from it! What's going on?

Well Facebook is preparing for an initial public offering (IPO) with a market capital of $100 billion (£61 billion).

How can it be worth so much?

You mean, apart from being one of the biggest and best known social networking platforms? Money from advertisements, as well as the increasing number of companies who are using the site, so it's some business... some pleasure.

I can't remember a time when Facebook wasn't around! How many users are there these days?

It wasn't all that long ago that it was created - it's not even 10 years old yet! The website was originally launched in February 2004 by founder Mark Zuckerberg. There are more than 683 million users, 500 million of which are active users.

So correct me if I'm wrong, but wouldn't that make each user worth £90 or thereabouts?

It seems so...

But I'm sure I heard that the number of users was decreasing?

In the UK, 100,000 users de-activated their accounts in May 2011, whereas in 2010 the number of active users increased by 100,000 to 500 million in just three months, between February and July.

Is Facebook going to be the first to head in this direction?

LinkedIn was the first US-based social networking site to get a listing and its share prices reached $122 (£75), but some have put this down to investors who showed early excitement in social media stocks and shares.

Either way, at that price Facebook must be the biggest company ever!

It's big but it's not that big! Apple, for example, is worth $307 billion (£189 billion). Bank of America is worth $109 billion (£67 billion). Facebook is bigger than Disney though which is worth just $72 billion (£44 billion).

Just $72 billion?

I meant that for such a famous company that was founded way back in 1923, its value is slightly dwarfed by Facebook's.

And what about the banks then? They must be minted thanks to mortgages and insurance!

It may come as a shock then that banks' market capital isn't more than it is. Barclays, for example, sits at $52.8 billion (£32.5 billion). And Prudential at just $29 billion (£18 billion) is a surprise.

A surprise indeed, considering how many of us have to scrape together the pennies to pour into their pockets!

Consider that, and then think... how much have you ever paid to Facebook?

Well, nothing.

Yet it's worth $100 billlion. Mark Zuckerberg must know something we don't. He could buy 588 Bugatti Veyrons with that!

A Bugatti what?

Only the fastest car in the world! Ok, just for you, how about more than five thousand Hermès Birkin bags by designer Ginza Tanaka at just $1.9 million a pop!

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