You’ve Made the Majors, Now Play in It

by | Dec 6, 2018 | Best Business Helps | 0 comments

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You’ve Made the Majors, Now Play in It

Articles

If you were a small startup, suddenly becoming hugely
popular, would you align with a bigger brand or keep the startup momentum
churning?  It’s somewhat akin to the
decision some high school or in-college athletes face when approached by
major-league teams.  Do you carry on with
your innocent talent or do you join the ranks of the bigger and better
experienced, hoping to maintain that initial spark?

The Instagram duo played impressively, to the point the
performance made Zuckerberg desire Instagram on his ‘team.’  Was it a good idea?  Strictly thinking in monetary terms, with the
deal culminating at $ 1 billion (30 percent cash, 70 in stock), it’s a
no-brainer question.  However, there are
some looming considerations.

“I hope they didn’t agree to this deal because of
Facebook’s valuation on the secondary markets. 
It’s still unclear whether there’s a strong correlation between pricing
on the secondary markets and the public market,” says a former Google
exec.

Facebook, expected to open its financial doors to the public
next month, is estimated to value the IPO at $104 billion.  The New
York Times observes this number is aligned with what Facebook is trading
for on the secondary market (shares are selling as high as $40).

It’s understood the secondary market ‘helped’ Instagram
execs wrap their head around the Instagram/Facebook deal.  If the IPO goes as expected or better, the
Instagram team could enjoy some extra benefits. 
If the IPO is less than grand, the proceeding sentence does an about
face.

This is just another story of anxiety.  There’s no way to know for sure how it will
all go until it all happens.  What will
happen with the Instagram duo?  Surely,
both young men could retire due to the fruits of their limited labor.  Was that their original intention?  Were they playing for the love of the game or
for the love of the spoils of the game?

Mark Zuckerberg seems to be a player.  I’m wondering when Facebook does go public,
how he will act; I’m growing bored of speculation.  There’s no doubt a bit of ‘freedom’ and
‘independence’ is lost once a player enters bigger leagues.  Zuckerberg explains the Instagram deal is
more about improving the quality of Facebook than the quantity of its
revenue.  “We don’t plan on doing
many more of these, if any at all.  But
providing the best photo-sharing experience is one reason why so many people
love Facebook, and we knew it would be worth bringing these two companies
together.”

Hopefully the exchange of funds goes well for all parties
involved.  More so, I hope all parties
involved in acquisitions and IPOs, are well compensated in intrinsic value,
being satisfied with their decisions.

Todd Bailey is Director of Search, Media and PR with Gen3 Marketing and US Brand Ambassador for Majestic SEO. Also, Founder/Editor of pushStar.com

We all are waiting for public shares of facebook, whether it’s overvalued or not we just want to see those shares publicly.

$1 billion for Instagram and then launching Facebook Camera???

Add that to the IPO fiasco and I’m seriously starting to think the company is heading for trouble.

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