ssparikshya
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Facebook has raised at least $16 billion with its initial public offering. It puts the value of the company at $104 billion, making founder Mark Zuckerberg one of the world's richest men: he is worth $19 billion, not counting his hoodies.
It is easy to see signs of the crazed fever that had built up a tech bubble at the turn of the century, which valued America Online several times as much as Time Warner, only to see the valuations fall to reflect real earnings once the bubble burst and rational thought replaced euphoria.
The seeming lack of avenues for profitable deployment of lots of liquidity in most parts of the developed world certainly helps drive the demand for a piece of what promises to be future prosperity, and Facebook shares are likely to go up in the near term. But it is unlikely that its share price would not face a correction, once revenue growth fails to catch up with the feverish pace implicit in the company's valuation.
This will not take away the huge war-chest the IPO has handed the company. Nor will it disappoint the venture capitalists who funded Facebook and now exit in style. The Facebook IPO success will boost creativity in three different ways.
One, the riches to be had from funding the right start-up will entice angel and venture investors to mediate capital to fund innovation as never before, across the world. Two, the number of tech-savvy youngsters who wish to try their hand at entrepreneurship would shoot up.
Three, with a host of small and large investors to answer to, Facebook would be under pressure to boost revenues, and seek to create new revenue-generating applications on its platform. It can use the money to both fund in-house research and to buy up companies and products that make creative use of the Facebook ecosystem.
At the societal level, the gap between digital natives and the rest will widen ever more.
The Facebook IPO, complete with its tech-to-riches storyline and new impetus to creativity, makes it all the more imperative that governments around the world invest in policy and infrastructure to make high-speed broadband ubiquitous and affordable. That imperative has a cutting edge in a poor country such as ours.
TOI
It is easy to see signs of the crazed fever that had built up a tech bubble at the turn of the century, which valued America Online several times as much as Time Warner, only to see the valuations fall to reflect real earnings once the bubble burst and rational thought replaced euphoria.
The seeming lack of avenues for profitable deployment of lots of liquidity in most parts of the developed world certainly helps drive the demand for a piece of what promises to be future prosperity, and Facebook shares are likely to go up in the near term. But it is unlikely that its share price would not face a correction, once revenue growth fails to catch up with the feverish pace implicit in the company's valuation.
This will not take away the huge war-chest the IPO has handed the company. Nor will it disappoint the venture capitalists who funded Facebook and now exit in style. The Facebook IPO success will boost creativity in three different ways.
One, the riches to be had from funding the right start-up will entice angel and venture investors to mediate capital to fund innovation as never before, across the world. Two, the number of tech-savvy youngsters who wish to try their hand at entrepreneurship would shoot up.
Three, with a host of small and large investors to answer to, Facebook would be under pressure to boost revenues, and seek to create new revenue-generating applications on its platform. It can use the money to both fund in-house research and to buy up companies and products that make creative use of the Facebook ecosystem.
At the societal level, the gap between digital natives and the rest will widen ever more.
The Facebook IPO, complete with its tech-to-riches storyline and new impetus to creativity, makes it all the more imperative that governments around the world invest in policy and infrastructure to make high-speed broadband ubiquitous and affordable. That imperative has a cutting edge in a poor country such as ours.
TOI
