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Facebook went public in May 2012 holding its IPO (Initial Public Offering). Based on the IPO price of US $38 per share , Mark Zuckerberg owned 503 million shares, thus making his net worth at US $19 billion. On the opening day, the share value rose to $45 per share, but after that it has been a bumpy ride down for Facebook and it's CEO-Founder Mark Zuckerberg.
In July 2012, the share value dipped down to US $24 per share, which brought Zuckerberg's net worth down from $19 billion to $12 billion. So, in a matter of weeks he had lost about $7 billion.
Why Mark Zuckerberg lost $8 billion ?
The reason he lost $8 billion was because of the fact that Facebook performed very badly as a public company. Losing $8 billion didn't mean he had to pay the money from his pocket. It simply means that since Facebook lost it's share value, he (owning 503 million Facebook shares) also lost his net worth because of that. The reason that Facebook suffered such a massive loss was because it's share value was overvalued at it's IPO.
In addition to Mark Zuckerberg, some facebook insiders also lost a substantial value of money in the company's IPO fiasco. Facebook COO Sheryl Sandberg had lost $700 million, co-founder Dustin Moskovitz has lost $1.6 billion, and former executive
Sean Parker has lost $1 billion.
Can Facebook Regain it's lost pride ?
Facebook may have lost a lot of money, but let's not forget it now has more than 1 billion users which holds lots of potential for bringing in big dollars.
Back in July, Zuckerberg had sold 30.2 million of his shares for $37.58 per share which the company admits was necessary to pay his taxes in which he made $1.1 billion. At that time, the stock price was set at $32 per share making his net worth at $16 billion at that time. After that, it has been a complete downhill for him.
As for the future, no one knows whether the share value will dip or rise. In stock market, the past performance is no guide for future performances. As time passes and lock-up periods expire more and more facebook insiders will be able to sell their shares in the market. In the recent times, the most important date will be November 13 when 1.24 billion shares will be released into the market. Whether Facebook will continue it's downfall or rise up, we will just have to wait and see.
