Lots of thoughts on this... let me try to be brief. And my opinions on this should not be considered as investment advice, but rather my observations following up on my interview with WebProNews earlier this year. I am a marketer and practitioner, not an investment professional.
- The Facebook IPO is the apex of this cycle. Finally, we can all buy & sell shares of the world's dominant social property. Woohoo!
- The Facebook price range was increased today, which will value the company at roughly $100b when it begins trading. Unreal -- although this was inline with where the company was valued in the private markets six months ago. So no real surprise there.
- If you're going into $FB as a "trader"... i.e. you will be playing the daily or even less frequent idiosyncracies of how the market views the stock. Godspeed.
- But if you're going into it as an investor, you're banking on Facebook taking more & more advantage of the 900 million users that it has at its disposal. You're betting that it is critical infrastructure that is more or less here to stay. Fatigue, competitors, legal issues, lack of real ads progress on mobile, the higher proportion of Facebook users from mobile devices, advertising effectiveness, etc. be damned. And you're betting that Facebook will increase the ARPU (average revenue per user) from the paltry few bucks per person that it makes today. Again, Godspeed.
- Finally, let's keep in mind that Facebook's user growth has significantly slowed. It used to announce the next hundred million users on a quarterly cadence. Now, the law of large numbers has taken hold... and it might crack 1 billion in 2012. Nonetheless, Facebook still has amongst its user base about 45% of the world's Internet population.
All of that said, it's still the gold standard of social media -- and is not likely to be supplanted by any of its rivals anytime soon.
Facebook will emerge from this with a massive cash hoard along with stock -- both sets of currency available for acquisitions, product development, hires, etc. That's going to prove to be remarkably powerful and will shape the latter stages of the post-social era.
I'll be too busy launching Polygraph to pay close attention to the play-by-play on CNBC later this week. If you decide to play, good luck!
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