The current financial theories (life cycle theories, valuation theories and market timing theories) on IPOs need to expand to include social values. An IPO not just changes value of the firm but a social event. We should exam how public, investors, IB /underwriters, founders, VC and SEC interact to change the firm valuation
June 2004: Facebook founded by Mark Zuckerberg.
Summer 2004: Peter Thiel invests $500,000. Facebook is valued at a mere $4.9 million.
May 2005: Accel Partners invests $12.7 million. Facebook is priced at around $100 million.
March 2006: $750 million–Facebook reportedly rejects a $750 million offer for the firm.
April 2006: $500 million – Facebook raises $25 million in its third round of financing, valuing the company at around $500 million.
July 2006: $1 billion–Yahoo offers $1 billion for Facebook. But after Yahoo shares drop on separate news lowers its offer to $800 million, which Facebook rejects.
October 2007: $15 billion–Microsoft buys a 1.6% stake in Facebook, placing a $15 billion valuation on the company.
May 2009: $10 billion–Facebook receives a $200 million investment from Russian Internet-investment group Digital Sky Technologies, representing a nearly 2% stake at a valuation of $10 billion for Facebook preferred stock.
November 2010: $35 billion–Venture-capital firm Accel Partners, an early backer of the social-networking firm, sells less than 15% of its stake for $517 million.
December 2010: $56 billion–Facebook’s average valuation based on transactions on SharesPost rises to more than $56 billion.
January 2011: $50 billion–Facebook raises $500 million from Goldman Sachs and a Russian investment firm in a deal that values the company at $50 billion.
November 2011: $100 billion – Facebook, planning its IPO documents, is reported to be seeking to raise $10 billion at a valuation of $100 billion.