Opinion: Why Facebook's IPO is great news for the mobile games industry

$16 billion of new investment cash available today

Opinion: Why Facebook's IPO is great news for the mobile games industry
There will be many winners when Facebook IPOs.

CEO Mark Zuckerberg is top of the list. His 443 million Facebook shares are potentially worth $16.9 billion at the float price of $38 per share.

Of course, it will be almost impossible for him to ever sell his entire stake, but even the 30.2 million shares he's selling will net him $1.15 billion in cash at the float price.

Bay area boom

In total, 421 million shares are being sold today, giving a IPO a value of $16 billion, and Facebook a market cap of $104 billion.

More specifically, it will create several instant cash billionaires and hundreds of millionaires among Facebook's management and employees.

It's also a red letter day for the many venture capitalists who have invested in Facebook over the past couple of years.

For example, Accel Partners will get $1.86 billion, DST Global $1.74 billion and Elevation Partners $176 million.

You also might be surprised that Microsoft's early investment in Facebook will pay off to the tune of $249 million, while Russian internet company Mail.ru (also a PC and mobile game publisher) gets $745 million.

Prominent individuals are also cashing in.

PayPal co-founder Peter Thiel will trouser $640 million, Zynga CEO Mark Pincus is selling $38 million of his Facebook stake, and LinkedIn co-founder Reid Hoffman will get $36 million.

Even the state of California is happy, getting a tax windfall of $1.2 billion.

Trickle down

But the whole of the technology sector, including mobile game companies, should be happy.

For one thing, Facebook itself gets around $6 billion in cash, which it can use for acquisitions, although it's unlikely to be buying game companies. 

More generally, IPOs like Facebook are a mass transfer of cash from the traditional banking, insurance and pension sectors, and that cash will quickly find its way into funding new start ups, as well as new funding rounds for existing companies.

For example, Accel Partners has already been very enthusiastic in the sector, funding the likes of Dragonplay, flaregames, Supercell and Mind Candy.

And individuals like Thiel, Hoffman, and other recipients of earlier large deals and IPOs such as ex-Playdom CEO Rick Thompson, and Netscape co-creator Marc Andreessen (another Facebook shareholder, and on the board of TinyCo) are now important players in the investment scene.

Pincus and Zuckerberg will likely join their ranks in future too, using their enormous wealth to fund the next generation of entrepreneurs.

After all, there's only so many Ferraris or hoodies you can buy.

[source: CBSnews]
Contributing Editor

A Pocket Gamer co-founder, Jon is Contributing Editor at PG.biz which means he acts like a slightly confused uncle who's forgotten where he's left his glasses. As well as letters and cameras, he likes imaginary numbers and legumes.