Who gets the money from the facebook IPO?

I need to understand IPO's a bit more;

so if facebook is valued at 100 billion, and if Mr. Zuckerburg owned it 100%

does Mr. Zuckerburg get 100billion if he decides to do a full-out 100% IPO?

but we learn in class that IPO's raises capital for the firm to expand? so who gets the money? zuckerburg or facebook?

Comments (2)

May 16, 2012

Generally what you have in the case of an IPO are two scenarios and occasionally a combination thereof:

Scenario #1: Treasury Offering - Company decides to sell 10% of the company to the public and raises $500mm to pay down, fund capex, etc.

Scenario #2: Secondary or Selling Shareholders - Company decides to sell 10% of the company to the public and raises $500mm to existing shareholders who wish to sell their shares and cash out of their investment.

Scenario #3 would entail a split between the two (i.e. 200 to selling shareholders and 300 to de-lever the company)

This is a fairly high level description but it should suffice for your purposes.

May 16, 2012
Comment

The HBS guys have MAD SWAGGER. They frequently wear their class jackets to boston bars, strutting and acting like they own the joint. They just ooze success, confidence, swagger, basically attributes of alpha males.