Reminder: The Facebook of 5 billion IPO does not make you rich

Reminder: The Facebook of 5 billion IPO does not make you rich:  It's broadly appear that Facebook is traveling to book for an IPO today, and acceptable that the alms will be in the $5 billion range. Time to alpha digging up your backyard banknote stash, right? Wrong. For the boilerplate guy the Facebook IPO is carefully Like, don't touch.

What's an IPO, Anyway?

IPO stands for Initial Accessible Alms which, in apparent English, agency a aggregation putting itself on the banal market. Or, if you're in an antebellum mood, Facebook is announcement its babe ball.

At its a lot of axiological level, an IPO is an befalling for a aggregation to accession lots and lots of money actual quickly. In this case, Facebook will reportedly advertise $5 billion account of disinterestedness to alfresco investors, and will use that money to abound its business/buy yachts.

That $5 billion ability complete like a lot, but it's in fact about bisected of what had been accounted (before, uh, this newer rumor). And it is small, accustomed that the absolute amount of Facebook, accessible company, is accepted to be a whopping $100 billion. If both of those numbers authority up, the lowball IPO is because Facebook doesn't wish egg on its face; if you set the starting bid too top at a available auction, no one gets a date.

So I Can Buy Facebook Shares Today?

Nope! Sorry. What's reportedly accident today (and about absolutely accident this week) is that Facebook is filing a propectus for its IPO with the Securities and Exchange Commission. The announcement will be a fun apprehend for the accounts folk; it's an all-embracing attending at finances, projections, and how Facebook sees the aggressive landscape.

It's aswell if Facebook assuredly says how abundant it thinks it's worth. Or rather, how abundant the investment bankers it assassin (supposedly Morgan Stanley and a few others, in this case). And if I say "worth," I don't beggarly how abundant money it has in the coffer or how abundant acquirement it takes in. The gigantic amount (that $100 billion) that you'll apprehend associated with Facebook today is a chiffon one, a guess. It's how abundant the aggregation is accepted to be account as it continues to abound over time.

After the announcement has been submitted, there's a "quiet period" while the SEC considers its validity. Bottom line: Assuming Facebook files all its affidavit today—and they're all in order—it's traveling to be a few months afore Facebook shares are in fact listed.