Facebook IPO: Top 10 surprises

February 2, 2012

There is a whole lot of information in Facebook’s filing for its initial public offering on Wednesday. Some of it was fairly on par with what people expected — Facebook’s concerned about privacy legislation? No way. — while there were other parts of the filing that threw us all for a loop.

Here are the top 10 surprises to come out of the Facebook filing:

How many users?: Facebook now has 845 million users — 45 million more than the company reported in September — and 483 million daily active users. Those users generate $2.7 billion daily likes and comments, many of which are about the 250 million photos uploaded each day.

How many relationships?: Facebook has a stunning 100 billion relationships on its site — one for every dollar of the highest estimate of its valuation.

How much are they making?: The company brought in $3.7 billion in revenue last year and $1 billion in profit. Another interesting thing to note: Based on Facebook’s own revenue and user data, every monthly user on the site is worth about $4.62.

Zuckerberg’s security detail: Zuckerberg has a “comprehensive security program” which covers security personnel and the installation of a security system at his home. The security costs are included in his overall compensation.

Plans for global domination: Just kidding. But really. Facebook is casting a hungry eye overseas, and more and more of its revenue is coming from non-domestic sources. Facebook is available in 70 different languages and is looking closely at some of the hottest global markets out there: Brazil, India and China. China, as The Washington Post’s Sarah Halzack reported, presents its own set of complications, but could help the company get the growth it’s looking for.

The company is also looking to make further inroads into countries where Facebook faces stiffer social networking competition, such as Russia and Japan.

Growth: The days of Facebook’s fastest growth — at least in the United States — appears to be behind it. U.S. user growth trails the rest of the world, likely because the company has already penetrated such a high percentage of the American market.

Mobile: A big surprise in Facebook’s filing was that the company appears to have a problem with mobile. The company doesn’t have display ads on its mobile products now, and said that it worries the trend toward mobile could really hurt its bottom line. If the company can find a clever, non-intrusive way to use all of its data for mobile marketing, it will be a huge deal. But control over the ads is a problem — Facebook doesn’t make its own phone, have its own carrier or make its own operating system, which could all affect how the company is allowed to display ads.

Sheryl Sandberg: Losing chief operating officer Sheryl Sandberg was listed as a risk factor in the IPO paperwork, a surprising if not shocking mention for the former Google executive who’s become a very important part of the social network. There’s been speculation that Sandberg, who has a background as a D.C. insider, may consider going into politics.

Zuckerberg’s succession plan: In a provision that has prompted a lot of royalty jokes on the Web today, the S-1 filing revealed that Zuckerberg will be able to appoint someone to take over his controlling shares.

From the filing: “In the event that Mr. Zuckerberg controls our company at the time of his death, control may be transferred to a person or entity that he designates as his successor. As a board member and officer, Mr. Zuckerberg owes a fiduciary duty to our stockholders and must act in good faith in a manner he reasonably believes to be in the best interests of our stockholders.”

Zynga, Zynga, Zynga: In its S-1 filing, the company revealed that its partnership with Zynga accounts for 12 percent of its total revenue — a very surprising amount for a single company.

That’s around $445 million of the company’s 2011 revenues. The money comes from the cut that Facebook receives through Zynga’s in-game purchases and advertising.

Related stories:

Facebook IPO: Who are Facebook’s shareholders?

Facebook IPO filing: How does the social network feel about China?

Facebook warns investors more federal probes may come

Hayley Tsukayama covers consumer technology for The Washington Post.
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