Will Facebook Go Public?
Once a company has 500 shareholders, it must register its private shares with the S.E.C. and publicly disclose its financial results. Is Facebook approaching the limit?
Facebook likes big numbers—it now has more than 500 million users, each one of whom can have as many as 5,000 friends. Yet as a privately held company, its ownership base must remain small, or it will have to disclose publicly its financial results. A surging shadow market in the privately held shares of Facebook is making such restraint difficult and could spur the company to go public—even as its executives try to tamp down speculation about an initial public offering—much as similar pressure helped push Microsoft and Google toward their own initial public offerings.
