Let me start by saying that I’m surprised to hear some of the negative reactions to the Facebook IPO announcement. There is a dangerous mindset permeating our country that wealth, success and big business is wrong. Although I leave room for the occasional bad apple, let me assure you that this is not the case. As an advisor to many successful individuals across the country, I hear more questions about philanthropic endeavors than I do about overseas, tax-advantaged hedge funds.
Facebook’s public offering will make Mark Zuckerberg one of the richest people on the face of the earth as I’m sure you’re aware. With a valuation of $100 billion, his 533,801,850 shares would be valued north of $28 billion. Perhaps a more remarkable number is 56.9%, as in, the number of voting shares Facebook’s founder was able to safeguard for himself to retain complete decision making power. Let’s also not forget that he had an opportunity to sell the company for what was, at the time, considered a whopping $1 billion to Yahoo. Ultimately, the choice was made to turn it down in a call that Zuckerberg unpretentiously described as “hard.” He stayed true to his vision of making the world more connected and bet on himself and the team. That decision has certainly paid off, and now the IPO will create an estimated 1,000 millionaires.
The winners include more than the employees of Facebook, however. The State of California stands to make hundreds of millions in tax revenue as positions are liquidated. Real estate agents, car dealerships, and restaurants will benefit tremendously, and you can bet flip-flop and hoody vendors will clean up! If I were a public official in a state with less sunshine than California, I would start giving some serious thought to a strategy for incentivizing and attracting the startup community.
What if you’re not an entrepreneur and prefer to provide your skills on contract or salary? In my recent discussions with successful start-up CEO’s, several have admitted the talent war is so heated they are taking steps to hide prized employees. With a revitalized IPO market placing wealth in the hands of so many young innovators, I imagine new companies launching immediately and the battle for high quality workers coming to a boil. Early equity offerings and enhanced workplace environments will be more commonplace than ever to attract and retain top-tier skill.
I am 2 months and 10 days older than Mark Zuckerberg. When Facebook goes public, and he (potentially) becomes the 9th richest person on the Forbes Billionaire list, I’m not going complain about his taxes being too low or lobby for handouts. I’m going to call up my friends and say that this is the moment of Gen Y’s official, empowering arrival. Let’s continue to innovate, grow and succeed. Our communities and our country will prosper because of it.
Congratulations to Facebook. Let’s celebrate the moment.
Evan Kirkpatrick is the founder and CEO of Wendell Charles Financial, a private wealth management firm for select individuals and institutions. Prior to founding Wendell Charles, Evan began his career at a global Fortune 100 firm and ran the investment division of a boutique wealth management and corporate benefits company.
The Young Entrepreneur Council (YEC) is an invite-only nonprofit organization comprised of the world’s most promising young entrepreneurs. The YEC promotes entrepreneurship as a solution to unemployment and underemployment and provides entrepreneurs with access to tools, mentorship, and resources that support each stage of their business’s development and growth.