After LinkedIn’s initial public offering stole headlines earlier this year, highlighted by a spike during first-day trading, it was clear that more social networks would entertain the idea of doing an IPO as well.
Among the most obvious if-not-when candidates is Facebook, which would reap all kinds of benefits beyond raising hundreds of millions or billions of dollars, making the stock more liquid and providing a clearer view about Facebook’s value.
There is obviously palpable excitement among Facebook employees, especially those who have been there the past three to four years, who own real stock options in the near future.
With Facebook having to comply with federal regulations and disclose their financials, it now makes going public an easier pill to swallow.
For the past year, many pundits have debated whether it was made sense for Facebook to go public. One of the main issues is will a wave of inflated IPOs force the bubble to blow too big; stirring fear of an inevitable burst.
This fear is overstated because it’s mostly based on leftover fear from the first dot-com bubble bursting. Putting this aside, there is another factor this issue that could prove to be significant.
A major and intriguing reason that an IPO could be a positive for Facebook is it will force the company to either groom Mark Zuckerberg to be a real executive, or force them to find one, or possibly promote COO Sheryl Steinberg to CEO.
Zuckerberg is a programming genius but as a CEO of a publicly-owned company he would have to open up, become more media friendly and savvy, and alter his personality. Steve Jobs might have been hard-headed, emotional and difficult but he had enough charisma for 100 executives.
Zuckerberg belongs more in the trenches than perched at the top. Even though he has proclaimed he is the CEO, his social skills might prove distasteful if he had to answer to shareholders on a regular basis.
As always, Zuckerberg’s ability to inspire confidence (or lack thereof) will be front and center.