Facebook is going public for $5bn

PEOPLE DATABASE Facebook has filed with the US Securities and Exchange Commission (SEC) for an initial public offering (IPO) of stock for $5bn in investor cash.

The firm released a huge document to go with the filing, and it includes a lot of detail about its business. Not least of all how profitable it is.

Facebook, which is used by members to brag, poke, gas, whine, wheeze and whinge, makes a lot of money. In 2011 it earned revenues of $3.7bn for operating income of $1.7bn. It does not make money directly from its users, but from the services and features that they use.

The introduction of the Like button, for example, was good news in the accounting department as it helped Facebook rake in advertising money, while social games such as Farmville also boost its earnings.

In a letter to shareholders CEO Mark Zuckerberg, who owns around 28 per cent of Facebook, said that the goal of the IPO and the business itself is to improve the lives of those involved in it.

"We don't wake up in the morning with the primary goal of making money, but we understand that the best way to achieve our mission is to build a strong and valuable company. This is how we think about our IPO as well," he wrote, according to a report from the Press Association.

"We're going public for our employees and our investors. We made a commitment to them when we gave them equity that we'd work hard to make it worth a lot and make it liquid, and this IPO is fulfilling our commitment. As we become a public company, we're making a similar commitment to our new investors and we will work just as hard to fulfil it."

Zuckerberg, who will remain in control of the company after the IPO, said that he will take an annual salary of just $1 from January next year. µ