Goldman, Citing Strong Response, to End Facebook Solicitation

Folks - Facebook is having their IPO without the P before our very eyes.<p>If it was any company other than Goldman Sachs, who is very well politically connected, the SEC would be shutting this down within 3-4 months and requiring Facebook to publish their financial results.<p>As it is - I still give it no more than six months before Facebook is required to start announcing results publicly.<p>Fascinating attempt to dodge regulatory and reporting requirements though - using Goldman as the "Investor of Record" to keep their numbers &#60; 500.

"To get Facebook shares, clients must agree not to sell them until 2013"<p>Why? Do they fear everybody selling short after? If I believe in Facebook I would keep their stock for a better growth year after year. Unless they know something we don't, or unless they know everybody will dump a hyper inflated stock.<p>You can't force me not to sell whenever I want, and that sole clause makes me very suspicious.

I posted this in another thread but repeating here since more relevant to this story as well:<p>One of the things that goes unmentioned is that with the right feedback loops companies can ramp up quickly like never before is true. But those same loops are in place for the site to die down very quickly too.<p>In the valuation for such companies analysts often use a multiple times revenue (or users etc). This multiple is based on the old school model that it took time for companies to die, for competitors to emerge etc. Doubt that is true anymore. One bad move that pisses off the community and people will leave in droves too.<p>Digg anyone?

"It's a blowout," said the guy playing NBA Jam on his Goldman Sachs-issued Sega Genesis.

I think this maneuver is indicative of a broader problem related to the cost of being public. More and more companies are doing everything they can to avoid it. The administrative overhead, media scrutiny and regulatory costs are simply out of control.<p>As more and more companies invest resources to avoid going public, we need to look at the process and figure out why. This is similar to the tax code. The volume of people and dollars spent to legally avoid taxes is so great that there is clearly something fundamentally wrong with the system.

"Facebook had net income of $200 million in 2009 on revenue of $777 million."<p>It's interesting that it cost Facebook $577 million to run in 2009. I'd love to see a break-down of where all that money is going. On the face of it, it seems like an extremely wasteful amount of money to run a site like that. $1.6 million a day in operating expenses.<p>Yet people are still falling over themselves to invest.

Doesn't the strong response demonstrate that the offering price was too low?

Can we <i>finally</i> get some momentum behind getting rid of Sarbones-Oxley? It's not helping, and it seems to be making things worse.

Either<p>A.) There are really that many stupid billionnaires<p>B.) There are really that many stupid billionnaires who don't mind getting burned by GS multiple times in the past, who do their due diligence in matter of hours<p>C.) Goldman Sachs is breathing, a.k.a lying. (our government says corporations are human beings, ya know)