Income Diary

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Who Owns Facebook? – The 10 Richest Facebook Shareholders

By:     Topics: Entrepreneurship

Last week it was announced that Facebook would be releasing their initial public offering (IPO), which estimates the value of the company at roughly $100 billion, in an effort to raise $5 billion in funds. This is a huge step for the company, who have been in no hurry to make the company go public, and with this new valuation, it makes a whole lot of people very rich indeed, possibly even 1000 millionaires. That would mean giving 7 figure payouts to nearly 1/3 of the company’s workforce.

We here at IncomeDiary aren’t quite sold on the valuation of the company, especially when you consider there’s only 845 users on website. Lets round that up to a billion users, that means that every user is worth $100 to Facebook. So with that knowledge, Facebook could start putting a ridiculous amount of money into advertising, and so long as they’re spending less than $100 per person, they will be making money. With a revenue of $3.7 billion last year, each user was worth an average of $4 each, so there is money there, but $100 billion valuation? That might be a little bit much when you consider that it’s 100 times that of the company’s profits to earning ratio last year – Apple has a profits to earning ratio of 13 for last year, and Google has one of 22. What do you think?

Mark Zuckerberg – 28.4% – $28.4 Billion

Everyone knows who Mark Zuckerberg is, he’s famous as the owner, founder and CEO of Facebook, and made even more famous when the movie ‘The Social Network’ was released, which tells the tales of the turbulent early days of Facebook. His wealth has grown year after year, and with the new IPO released, which you can read in full here, it’s revealed that he currently owns 28.4% of Facebook, which if current estimates are correct, is going to be work $28.4 Billion. With their best year yet at Facebook, revealing a $1 Billion profit on $3.7 Billion revenue, it’s no wonder that Mark’s worth has gone up.

Here’s another little interesting fact about Facebook. In 2011, Zynga, the owner of social games such as FarmVille, was responsible for roughly 12% of Facebook’s earnings. And that’s massive. Here’s a quote from Facebook’s IPO offering:

“We currently generate significant revenue as a result of our relationship with Zynga, and, if we are unable to successfully maintain this relationship, our financial results could be harmed.

In 2011, Zynga accounted for approximately 12% of our revenue, which amount was comprised of revenue derived from payments processing fees related to Zynga’s sales of virtual goods and from direct advertising purchased by Zynga. Additionally, Zynga’s apps generate a significant number of pages on which we display ads from other advertisers. If the use of Zynga games on our Platform declines, if Zynga launches games on or migrates games to competing platforms, or if we fail to maintain good relations with Zynga, we may lose Zynga as a significant Platform developer and our financial results may be adversely affected.”

That means that Zynga users spent $308M on Facebook last year alone, which is absolutely ridiculous when you consider what they sell.

With Mark’s Facebook money, you could buy…

  • 558 Gulfstream G550 private jets, at $50M each.
  • Antilla, the world’s most expensive home, 28 times.

Jim Breyer & Accel Partners – 11.4% – $11.4 Billion

For those of you that don’t know, Jim Breyer is an American venture capitalist and partner of Accel Partners, which currently owns a solid 11.4% of Facebook, which for those of you who haven’t cottoned on to the maths yet, that’s roughly $11.4 Billion. In August, 2010, Fortune Magazine named Breyer one of the 10 smartest people in technology, and you can see why. It’s his smart thinking and foresight into an incredible company, that has skyrocketed his wealth over the past few years. His previous success with earlier ventures ensured that there was enough money available invest in the right company, at the right time. His firm Accel Partners own the stake in Facebook, but he’s a very large part of the success, and the face of the company.

With Jim’s Facebook money, you could buy…

  • 228 Gulfstream G550 private jets, at $50M each.
  • Antilla, the world’s most expensive home, 11 and a bit times.

Dustin Moskovitz – 7.6% – $7.6 Billion

Dustin is just 8 days younger than Mark Zuckerberg, making him the youngest billionaire in the world. Dustin founded the site with Mark back at Harvard and holds on to a 7.6% stake of the company, which with this current valuation is likely to net him a worth of $7.6B. He left Facebook in 2008 to work on his own ventures, such as a mobile photo-sharing site, called Path (I’m sure you’ve heard about it lately), which has already turned down a $100 million offer from Google, and now serves over 2 millions people. As good as that may well be, you can’t help but compare it to the likes of Facebook, which has grown rapidly in the 8 short years since it was created. Clearly a force to be reckoned with.

With Dustin’s Facebook money, you could buy…

  • 152 Gulfstream G550 private jets, at $50M each.
  • Antilla, the world’s most expensive home, 7 and a bit times.

Yuri Milner & Digital Sky Technologies – 5.4% – $5.4 Billion

DST was founded by Yuri Milner to focus solely on investments in the internet sector, where they have investments in Facebook, Zynga and Groupon. They bought into Facebook with a $200 million investment in May 2009, based on a $10 Billion valuation. On top of that, they put another $100 million together to start buying employee’s shares to expand their stake in the company. In January 2011, they co-led an investment with Goldman Sachs of another $500 million based on a $50 billion dollar valuation. This has made them one of the largest shareholders in Facebook, and their stake in Zynga means that they’re making money from more than one source, seeing as Facebook users decided to spend $308 million on Zynga through Facebook alone last year. Ridiculous when you think about it.

With Yuri’s Facebook money, you could buy…

  • 108 Gulfstream G550 private jets, at $50M each.
  • Antilla, the world’s most expensive home, 5 times, with some spare cash left over for some fancy cars in the basement.

Eduardo Saverin – 5% – $5 Billion

You might recognise the name if you’ve seen ‘The Social Network’, and that’s because Eduardo played a key role in the company’s founding, back when he was roommates and best friends with Mark Zuckerberg. And if you’ve seen the film, you’ll know that their relationship went sour, and that Eduardo actually used to own a third of the company, before it went down to 30% when Dustin Moskovitz came aboard. After some disputes between Mark and Eduardo about how the company was going to move forward, and whether Eduardo was going to remain as part of the Facebook team, he got pushed out the company when a group of investors (including Peter Thiel from PayPal), got onboard. After a series of legal disputes, Eduardo finally got his stake pushed back up to 5%, and even from such a small stake, he’s worth an incredible amount of money. There might be love lost between the two of them, but I wouldn’t turn my nose up at $5 Billion.

With Eduardo’s Facebook money, you could buy…

  • 100 Gulfstream G550 private jets, at $50M each.
  • Antilla, the world’s most expensive home, 5 times.

Sean Parker – 4% – $4 Billion

Sean parker is a name that many of you would have been familiar with since way before Facebook, due to his role in Napster, the peer2peer file sharing program. When that eventually went sour and everyone tried to sue him, he walked away with an interesting reputation and a whole lot of knowledge. It was Sean that got involved in Facebook when it was just five months old, becoming the company’s first president, and helped the company to think big with the knowledge that he had acquired from Napster, and his role as an early advisor to Friendster (anyone remember that?). He introduced the company’s first investor to Mark, in the form of Peter Thiel (PayPal Co-Founder) and was the one to implement features such as the photo sharing function. In Mark’s own words, “Sean was pivotal in helping Facebook transform from a college project into a real company.”

He has other irons in the fire, and has recently invested $15 M in Spotify, which is a rival to the new version of Napster, but none of that accounts towards the wealth that we’re look at here today. With a 4% share in one of the fastest growing and most profitable companies on the internet, he’s a sizeable part of something very special.

With Sean’s Facebook money, you could buy…

  • 80 Gulfstream G550 private jets, at $50M each.
  • Antilla, the world’s most expensive home, 4 times.

Peter Thiel – 2.5% – $2.5 Billion

As you hopefully read above, Peter experienced early success on the internet with PayPal, which he sold for $1.5B in 2002, which left him with some money to put to good use. He became the first investor in Facebook back in 2004 with a $500,000 investment for a 10.2% stake in the company. His share has been of course watered down in the past eight years as new investors have gotten on board, looking for a stake in the business. His business acumen and foresight for a small company, with plenty of competitors, has served him well as it’s one of the fastest growing companies on the internet, with a value similar to that of McDonalds.

With Peter’s Facebook money, you could buy…

  • 50 Gulfstream G550 private jets, at $50M each.
  • Antilla, the world’s most expensive home, 2 1/2 times.

Microsoft - 1.3% – $1.3 Billion

Microsoft bought into Facebook right around the time that Li Ka-shing did below, paying $240 million for 1.6% of Facebook. Those shares have now been diluted somewhat, so their stake has come down to $1.3 billion, only earning them just over a billion dollars from their investment. Poor things. All jokes aside though, they had the money, and they saw the opportunity and potential so they took it. 2008, when they bought the stock, was an interesting time for Facebook, as it was only half the age it is now, and people were only just beginning to make the switch from other social networks.

I remember learning about Facebook in 2006, and I even opened an account, but I decided I didn’t like it, and didn’t come back to it until the next year. It was only in about 2008, when the majority of my friends and I started to say goodbye to MySpace for good, and open up a Facebook account instead. Microsoft’s investment at this time meant that the company was already in a very strong position, but still had plenty of room to grow, which makes it a wise time to invest for any investor. If anyone can find out how much of Microsoft Bill Gates owns, I’d be very interested to know, because then you could see how much he personally owns of Facebook.

With Microsoft’s Facebook money, you could buy…

  • 26 Gulfstream G550 private jets, at $50M each.
  • Antilla, the world’s most expensive home once, with a bit of cash left over for soft furnishings.

Chris Hughes – 1% – $1 Billion

Chris Hughes is the forth roommate to Mark, Eduardo and Dustin, from when they were back at Harvard, and that was how he got involved with Facebook. As well as a co-founder of Facebook, Chris was also in charge of the social media side of Barack Obama’s presidency campaign. He appeared on the cover of ‘Fast Company’ magazine, under the title  ”The Kid Who Made Obama President; How Facebook Cofounder Chris Hughes Unleashed Barack’s Base – and Changed Politics and Marketing Forever”. Now that’s a pretty bold statement to make about anyone, but it seems that Chris really did play a big part in promoting Obama, with his extensive knowledge of social media. I don’t know about you, but if I needed someone to help promote me through social media, I’d want one of the co-founders of Facebook too.

With Chris’s Facebook money, you could buy…

  • 20 Gulfstream G550 private jets, at $50M each.
  • Antilla, the world’s most expensive home, once. Still though, who really needs 2?

Li Ka-shing – 0.8% – $800 Million

The Hong Kong billionaire Li Ka-shing bought into Facebook in 2008, when the company had a valuation of around $15 billion and he only paid $120 Million. It sounds a bit ridiculous to say only when it’s an enormous amount of money, and only a very small percentage, but that very small percentage is now worth almost seven times what he paid for it, at $800 million. It makes you wonder what would happen now if you invested the same amount of money? I think that even back in 2008 there were plenty of investors who felt like they had already missed the boat, when really, that was when Facebook really started to take off and secure itself as a giant of the internet.

With Li’s Facebook money, you could buy…

  • 16 Gulfstream G550 private jets, at $50M each.
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