Facebook IPO no

Share this article:
Facebook stocks surged and then ... not so much.
Facebook stocks surged and then ... not so much.

First, I need to get the silly headlines out of the way, or I won't be able to concentrate.

  • Time to face the music
  • Status: fiasco
  • Who needs friends when you have bankers?
  • The honeymoon's over (By the way, hearty congratulations to Mark Zuckerberg on his recent marriage.)

So it seems like the value of Facebook's $16 billion initial public offering may've been a little overblown. In the few days after the social networking site to end all social networking sites went public on May 18 with a share price of $38.23, stocks have tumbled dramatically, ending at $31 per share at close of trade Tuesday. And in that same time span, CBS News reports that Facebook's worth went from $104 billion to just shy of $67 billion.

Add to that the fact of possible insider trading-esque funny business on the part of Morgan Stanley, the investment bank that served as Facebook's lead underwriter during the IPO process and you have, in the words of former SEC chairman Arthur Levitt a "dreadful” situation for the markets in which “nobody looks good.”

And oh yes, Facebook is being sued by its shareholders for the way Morgan Stanley marketed the IPO process pre-offering. Even Zuckerberg's a defendant in that.

There's a definite sense of Schadenfreude out there. Comedian Andy Borowitz, for example, poked fun at the hoodie king with a mock letter from Zuck to potential investors, in which he points out how very different Facebook's monster IPO is (as in not at all) from the early 2000's dot-com bubble: “For one thing, those bad dot-com stocks were all speculation and hype, and weren't based on real businesses. Facebook, on the other hand, is based on a solid foundation of angry birds and imaginary sheep.”

The upshot: If Facebook wants to help save itself, it needs to clean the yolk off its face (please forgive me, I can't help myself) and start courting businesses and marketers even more aggressively. As David Berkowitz, 360i's VP of emerging media put it to Direct Marketing News last week: “That's where the money is coming from.”

 

Allison Schiff
is web editor at
Direct Marketing News.


Share this article:
You must be a registered member of Direct Marketing News to post a comment.
close

Next Article in Direct Line Blog

Sign up to our newsletters

Latest Jobs:


Company of the Week


Founded in September 2009, Stirista is an integrated marketing agency that specializes in micro-targeting via traditional and digital channels. Our mission is to help companies, non-profits, and universities alike find new prospects and better understand their existing contacts. We are on the preferred vendor list for a handful of Fortune 500 companies with three of the ten largest companies in the world turning to us for marketing insights. To put it simply, we're young (at least at heart), ambitious, and sometimes impulsive-but always hungry for new ideas.

Featured Listings

Stirista

Stirista

Founded in September 2009, Stirista is an integrated marketing agency that specializes in ...