Not all of Facebook’s employees will get rich with the company’s IPO.
Facebook has a big year coming up: in addition to being the social network’s 7th birthday, 2012 will deliver the company’s initial public offering, which means we mere mortals can finally own a stake of the tech giant.
Many of Facebook’s employees, however, already own stock, thanks to their equity-packed paychecks, and will get a stake in the estimated $100 billion the IPO will generate.
This means of course, as MSNBC reports, that there will soon be an entirely new generation of millionaires, perhaps even thousands, with plenty of dough to spend on the struggling economy.
While this is good news for Silicon Valley retailers and luxury companies like Virgin Galactic (at least one anonymous Facebook employee plans to spend $200,000 traveling to outer space), the IPO may actually tear the company apart.
The company has… cut back on equity compensation for new hires. Managers hired one year ago received 2,000 to 30,000 restricted shares depending on the job function, according to another recruiter who had also worked for Facebook.
The company has also been stingier in handing out equity to noncore employees — so there may not be as many of the dazzling rags-to-riches stories that were commonplace at the time of the Google IPO, when in-house chefs and at least one masseuse struck gold with options.
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Facebook’s IPO has been long anticipated, but veterans of other startups that have gone public say the period after could be fraught with new challenges.
Some employees could grow jealous over colleagues with more stock, while others might look down on peers who are too quick to sell, questioning their loyalty to the company.And there is always the risk that talented staff would leave with their newfound wealth to make their own mark in the technology world by becoming entrepreneurs or investing in other promising startups.
Don’t worry, though, Facebook CEO Mark Zuckerberg will be set: the IPO will make him the world’s 14th richest person. So, other 27-year olds, how much are you worth?
