15 years : Bezos to Zuckerberg

15 years ago this week (5/16/1997), a New York Times headline read: ‘Amazon.com Stock Sale Raises $54 Million.’

SEATTLE, May 14— Amazon.com Inc. sold shares today at $18 each in a $54 million public offering, according to Deutsche Morgan Grenfell, which is managing the sale.

The Seattle-based Internet bookseller sold three million shares for more than the expected range of $14 to $16 a share. It will have about 23.9 million shares outstanding after the offering.

On Tuesday the company increased the size and the price range for the offering from 2.5 million shares at a range of $12 to $14, a sign of healthy demand. The offering has attracted considerable interest because Amazon.com is one of the first companies to exploit the Internet as a medium for commerce.

The public offering values the whole company, which will trade on the Nasdaq, at about $429 million.

The next day, a NYT headline read, “AMAZON.COM STOCK RISES 30% AFTER PUBLIC OFFERING.”

Amazon.com Inc.’s newly public stock began trading yesterday nearly $12 higher than its offering price as investors chased after one of the hottest offerings this year. Amazon.com stock was priced Wednesday night at $18 a share and it opened yesterday at $29.15 on the Nasdaq stock market. After climbing as high as $30 a share, it retreated and finished at $23.50, up 30.5 percent. Amazon.com, an Internet bookseller, has said that it sold $16 million worth of books in 1996 to 180,000 customers in 100 countries. Average daily visits to the company’s Web site rose to 50,000 in December 1996 from 2,200 in December 1995.

Amazon.com Inc.’s newly public stock began trading yesterday nearly $12 higher than its offering price as investors chased after one of the hottest offerings this year. Amazon.com stock was priced Wednesday night at $18 a share and it opened yesterday at $29.15 on the Nasdaq stock market. After climbing as high as $30 a share, it retreated and finished at $23.50, up 30.5 percent. Amazon.com, an Internet bookseller, has said that it sold $16 million worth of books in 1996 to 180,000 customers in 100 countries. Average daily visits to the company’s Web site rose to 50,000 in December 1996 from 2,200 in December 1995

15 years, almost to the day, later, a New York Times’ headline reads this morning, ‘After Buildup, a Modest Start for Facebook.’

While disappointing new investors betting on double-digit gains, Facebook had a wide winner’s circle. At a closing price of $38.23, Facebook’s market value is nearly $105 billion, creating huge paper gains for scores of early insiders, hundreds of employees and some stragglers who bought stakes recently.

Mark Zuckerberg, the 28-year-old founder known for his signature hoodie, owns a fifth of the company, worth $19.3 billion. Facebook’s first venture capital investor, Accel Partners, which wrote a $12.7 million check seven years ago, cashed out $1.9 billion in the stock offering and now holds a stake worth $5.8 billion.

“If you’re Facebook, it is hard to be disappointed when you’re one of the 25 biggest companies in the country,” said Peter Falvey, the founder of Falvey Partners, an advisory firm.

Amazing how achieving a valuation of over $100 Billion is disappointing.

Best I can compute that’s 200 times the size of Amazon’s valuation on its opening. Facebook is the 23rd largest company in the United States ranking by the S&P 500. Facebook may have created more jobs world wide in the last two years, including those working for Facebook and for companies feeding of Facebook growth, API, and Open Graph, than any other company in the world.

Maybe May, as for rituals like the Derby and 500, is the month for seminal IP0’s. Seems to me though that Mark Zuckerberg is following a path laid out by Jeff Bezos, including going public May 15 (missed by a couple days).

• Do something never done before. For Bezos, commerce on the Internet with a peer reviewed system to make shopping easier and more expansive for everyone. For Zuckerberg, a virtual social network reaching to every person in the world so as to allow us to get more done in less time.
• Realize an unheard of valuation for anything like it. Facebook is valued higher than McDonalds this morning and is generating discussion that it could be the first trillion dollar company.
• Personally become forces of nature leading their troops, followers, media, and the investment community to ultimately believe in what the leader was preaching when many had doubts for a long time.
• Today, Facebook’s stock only flatlined, it’s only virtual, they have no products, and advertisers will desert them in time. Remember Amazon.toast? Bezos was going down said the investment community only 11 or 12 years ago.

Sure, it may be difficult to get your head around something you may not use nor understand. And to wonder how this company led by a kid in a hoody that produces no products or services on the face of it can become one of the largest companies in the world.

But times have changed in the last 15 years. Look no further than people being astonished by 50,000 visitors a day going to Amazon.com in 1997 while Facebook has over 800 million regular users.

800 million. And the remainder of the world’s population to go.