Reports are circulating on the Internet that Facebook executives are a few years away from taking the company public. Facebook board member, venture capitalist and PayPal co-founder Peter Thiel told Reuters on Monday that the company is looking at making an initial public offering sometime after late 2012.
With more than half a billion users and a massive online presence, investors are likely to be extremely interested in getting a bite of Facebook.
Thiel, speaking to a Reuters reporter at the TechCrunch Disrupt conference, added that the decision to go public will depend on the social networking company's hitting specific revenue goals, as well as the long awaited development of its business plan. "It probably will IPO at some point," Thiel told Reuters. "The lesson from Google seems to be that you don't go public until very late."
A Facebook spokesperson couldn't be reached for comment at deadline.
Although Facebook has battled privacy issues this year, the company has been on a roll. The social site hit the milestone of accumulating 500 million users this past July. And in the month of August, Facebook edged out industry behemoth Google in the amount of time US users spent on a particular website.
Zeus Kerravala, an analyst at the Yankee Group, said Facebook is smart to not jump into an IPO right now. "Capital markets are still a bit soft so waiting isn't a bad idea," he added. "Waiting means the softness in the economy should be gone so the IPO is likely to have more upside."
Kerravala said Facebook needs to come out with a business plan and holding off on going public will give them time to come up with something solid.
"They need to build a firmer plan, but they do have some time to do so," he noted. "Going public creates Wall Street interest, gets you written about in the business press, raises the profile of the organisation and legitimises the company in many ways."