Buzz on a Facebook I.P.O. Grows Louder

The drumbeat to Facebook’s initial public offering is getting louder. The world’s largest social network may file a prospectus as early as next week, according to people with knowledge of the matter, who demanded anonymity because discussions are private. The company is still hammering out a final date, these people cautioned, but it is expected to submit its filing to the Securities and Exchange Commission within the next three weeks. Facebook — which will likely raise up to $10 billion in its offering – — is on track to be the largest Internet I.P.O. on record, besting Google’s $1.67 billion offering in 2004. Anticipation has been building for Facebook’s offering for quite some time. In recent years, shares of Facebook have been heavily traded in the secondary markets, exchanges where private shares are bought and sold. Last January, for instance, Goldman Sachs led a $1.5 billion investment round in the company, diverting the bulk of Facebook’s shares to its foreign clients. As its investor base has ballooned, Facebook has had to contend with a 1934 S.E.C. rule, mandating that any company with 500 or more shareholders must disclose audited financial results four months after the year it breaks the threshold. If Facebook reached that milestone in 2011, as many believe, it legally has until the end of April to disclose its financials. “It’s inevitable,” said Sean Parker in an interview with DealBook’s Andrew Ross Sorkin on CNBC this week. “There’s a possibility that it will be the largest offering in history.” Although Facebook’s 27-year-old founder and chief executive, Mark Zuckerberg, has at times seemed reticent to go public, he is facing mounting pressure from employees, hoping to sell some shares in the public market. If Facebook goes public by the end of May– as people close to the company believe it will—early shareholders will be able to sell some shares before the end of the year and, notably, before the expiration of tax cuts instituted during the George W. Bush administration. Typically, a company prevents its shareholders from selling shares until 180 days after the I.P.O. Facebook is expected to seek a market valuation of as much as $100 billion.