Few Weeks Before Facebook IPO The Craziness Already Here

Jim Carrey Crazy RiddlerThis month is going to be one of the craziest months this year (maybe even in this decade) where on some bright or cloudy day both the global tech and financial industries will emerge to glance at two letters on the NASDAQ, “FB”.

We are just few weeks away from the social networking company giant IPO and you can already sense the insanity, excitement, anticipation and yes also fear and confusion across the web. And as we’ll approach the big day, it is only going to get crazier. Tick, tock.

Facebook’s specific D-Day is still unclear, but the range is narrowing down to the third week of this month- Couple of weeks ago I reported that it is set for May 17th and now a new story on the WSJ saying it will happen on the 18th, Friday, which became a common day for tech companies to go public (Zynga and Groupon IPO were on a Friday).

But what is going to be REALLY interesting until that big day, is the traditional road show that will most likely begin next week. If you aren’t familiar with the term, “road show” is when a company upper management executive are going on the road and try “selling” to investors the company right before the public offering.

Facebook’s road show will allow a deeper gaze into the social network stats, number, analysis and future plans hosted by the company’s key people like the COO Sheryl Sandberg, the CFO David Ebersman and of course the king himself, the CEO/founder Mark Zuckerberg (AllThingD confirmed his participation).

But it seems that even though this road show hasn’t officially began, the web already started it… And not all the times for the right reasons. For example, last week the WSJ “broke the news” that Facebook enormous user growth is slowing down. Shocking.

Do you really think that Facebook among its 900+ million users which are roughly 15% of the world population can keep on growing at the same rate as before? It already has a reach of 80%-90% of internet users in most Western countries for god’s sake!

CNET also surprised me with somewhat misleading story (to be fair they don’t tend to do so). On the post, they try to portray Facebook as a company that doesn’t care about its advertisers which is of course totally BS.

Yes, of course that Facebook has SOME disappointed advertisers, but not in any different scale than any other giant online advertising company. I’m sure that if you dig deep enough you’ll find few “frustrated advertisers” for any big company. In fact, I’ve mostly seen recently positive indications about Facebook’s ad performances.

Another issue that is on the headlines lately is Facebook inefficient monetization efforts of its mobile platform. Facebook has 500 million users that are using mobile devices and the company has yet to find a proven method to generate revenue out of this huge mobile community.

But if I was a Facebook investor (disclosure: I’m not) I wouldn’t worry too much about it. Just two months ago the company has introduced its premium ad package that includes mobile ads and I’m sure that the good folks on Facebook’s advertising department will keep tweaking and trying until they’ll find the right mobile-ads formula.

Just to relieve some of the mobile pressure, Facebook released a post where it is essentially justifiably showing off on how it is contributing to integrated third-party mobile apps- On April Facebook sent over 160 million visitors to mobile apps which were responsible for 1.1 billion visits of those apps.

These numbers represent a growth of 2.5-3 times as much as two months before! Even though there’s no direct revenue generated from this mobile app referral traffic explosion, if we look into the subtext we would realize that there is actually A LOT of indirect revenue generated here…

When users are visiting more integrated third-party apps, they are essentially spending more time on Facebook. And more time spent on the social network means more ads served to these users. And more ads means more… Alright, you got the point.

Facebook has valued its worth at slightly less than $80 billion (about $31 a share) on its S-1 form fourth amendment, which I think it’s a fair estimation. But eventually, all this craziness will be summed up on the final and ongoing test- Share price.

Until then, we are heading into a lot of headlines, news, analysis, speculations, updates and misleading stories. Buckle up, it’s not going to be an easy ride.