How Does Facebook’s IPO Compare to Its Social Media Brethren?


How Does Facebook's IPO Compare to Its Social Media Brethren?

With Facebook Inc (NASDAQ:FB) facing too many problems to count from its IPO, you can’t help but wonder if this is the worst social media IPO ever. It may have some legs with this distinction but there’s probably a few other ones to add to the list.

Take a look at LinkedIn Corporation (NASDAQ:LNKD), Renren Inc (NYSE:RENN), Zynga Inc (NASDAQ:ZNGA), Groupon Inc (NASDAQ:GRPN) and Yelp Inc (NYSE:YELP).

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IPO date: 5/18/2011

IPO price: $45

First day close: $94.25

Since its IPO: up 1.29 percent, trading at $94.27

LinkedIn raised $353 million in its IPO through an offering of  7.8 million shares at $45. With its more than $4 billion  market capitalization, it was the most valuable US Internet IPO since Google’s 2004 debut, according to Renaissance Capital.

It opened up on the NYSE for trading at $83, an 84 percent rise from its IPO price.

What’s new?

LinkedIn suffered a breach in its password databases last week after an attacker supposedly uploaded 6.5 million encrypted passwords to a Russian hacking forum, according to InformationWeek.

LinkedIn director Vicente Silveira wrote in a blog post. “We can confirm that some of the passwords that were compromised correspond to LinkedIn accounts. We are continuing to investigate this situation.”

Fast forward a week later and LinkedIn’s lack of response has people grumbling that this incident will affect its reputation.

Cyber experts have said LinkedIn did not have sufficient protection and foresee the company finding additional data losses in the next few days as it continues investigating.

Renren Inc.

IPO date: May 3, 2011

IPO price: $14

First day close: $18.01

Since its IPO: down 72.92 percent, trading at $4.55

What’s new?

Renren tumbled 21 percent on May 18–the highest since its IPO– to $4.95 on the day of Facebook’s IPO. Prior to this, the company’s  shares had increased 76 percent in 2012 on speculation the long-awaited Facebook IPO would get investors to put a greater valuation on social media companies.

We all know how that turned out.


IPO date: November 3, 2011

IPO price: $20

First day close: $26.11

Since its IPO: down 60.4 percent, trading at $10.34

Groupon opened for trading on the Nasdaq up 40 percent from its IPO price at $28. Upon its IPO, its $17.4 billion market cap made it the sixth most valuable US Internet company.

What’s new?

Where should we begin with all their problems? But in honor of Father’s Day, Groupon is offering a $1,000 deal that will allow you to name your baby “Clembough.”

Here a partial description of the deal:

Groupon, the official World’s Foremost Authority in Baby Naming™ , will name your child or children “Clembough”. No substitutes or modifications. Spelling non-negotiable. Any attempt to name your child “Clembough” independent of this exclusive Groupon will be recognized by the world as a cheap imitation.

Any takers? I didn’t think so.


IPO date: December 15, 2011

IPO price: $10

First day close: $9.50

Since its IPO: down 41.58 percent, trading at $5.55

What’s new?

According to The, Zynga’s short interest has risen in the last few weeks. In the most recent reporting period from May 15, short interest swelled to more than one third of its shares in the market.

In case you have forgotten, 15 percent of Facebook’s revenue comes from Zynga apps and affiliated advertising. If Zynga has problems, so will Facebook.

On Monday, Zynga dropped 8.3 percent and hit an all-time low with its $5.55 closing price.


IPO date: March 11, 2012

IPO price: $15

First day close: $24.58

Since its IPO: down 23.31, trading at $18.85

What’s new?

On Monday at Apple Inc. (NASDAQ:AAPL)’s WWDC, the company announced its new iOS Map. Yelp has been integrated in the app.

While a good thing for the company, it wasn’t enough for Yelp to avoid tumbling along with the rest of technology stocks on Monday. It fell 4.02 percent to $18.85.

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