What’s Everyone Talking About? Facebook SKYROCKETED In The Public Market

Posted: June 8, 2012 in Business, Technology and Business
Tags: , , , ,

Everyone thinks Facebook flopped in the public market.

Worse, that this might affect funding and public offerings for a rash of other tech companies.

Huh?

Facebook skyrocketed in the public markets… going from $0 to over $50 billion in market capitalization in less than a decade.

If anything, that should encourage future tech investment, not discourage it.

The problems everyone is having is where that value was created.

It was created on a new innovation — “private exchange” markets where people can publicly buy and sell shares in private companies…

… which means Facebook has been public for a LONG time…

… and it means Facebook was the first company in history to have its share price run-up BEFORE it hit the well established public exchanges.

If anything, THAT should be the headline in all of this… liquidity is now available for private corporations before traditional liquidity events.

P.S.  As to Facebook share price… at 10x sales and 50x profits, Facebook is already trading like a mature company.  That means it’s probably going to hang around the 20’s for a while.

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