Saturday, 19 May 2012

Facebook's new billionaires

Mark Zuckerberg

From founder Mark Zuckerberg to Facebook's earliest investors, here's a guide to what Facebook's key players are now worth.


Eight years after Zuckerberg launched Facebook in his Harvard dorm room, his social network connects almost 1 billion people and has made him one of the richest people on the planet. He's selling off around 30 million shares in Facebook's IPO, raising $1.1 billion, but he won't be hanging on to most of the cash: Facebook say he'll use it to pay off a massive tax bill on a stock-options exercise.


                                                 Sheryl Sandberg


Mark Zuckerberg wooed his indispensible No. 2, Facebook's chief operating officer, away from Google in 2008. Sheryl Sandberg currently holds around 2 million Facebook shares, but has another 39 million that will vest if she stays with Facebook for several more years. 


                                                  The investors



Next to Mark Zuckerberg, Facebook's biggest shareholder is Accel Partners, a venture capital fund led by Jim Breyer (pictured above). He led the company's $12 million investment round in Facebook in 2005. Accel's stake is now worth more than $7 billion -- and it's cashing out. Accel plans to collect nearly $2 billion from selling shares in Facebook's IPO.
Other investors will also hit the jackpot. Silicon Valley "angel" investor Peter Thiel put up $500,000 to get Facebook through its first summer of operations. His 2.5% stake in Facebook is now worth around $1.7 billion. Investment firm DST Global holds a Facebook stake worth almost $5 billion.
                                                   Sean Parker
A geek hero for his role in co-founding Napster, Parker became a cultural icon thanks to Justin Timberlake's portrayal of him in The Social Network, Aaron Sorkin's Hollywood version of Facebook's foundation.
Parker played a key role in the company's early days, helping Zuckerberg secure financing and structure the company. He briefly served as Facebook's president, but got edged out as Facebook matured and brought on more seasoned executives. He didn't leave empty handed. Parker's Facebook holdings will do what Napster couldn't: make him rich. 
                                          Facebook's co-founders
Zuckerberg gets most of the credit for Facebook, but he was part of a launch team of four. None of Facebook's other co-founders are still at the company.
Dustin Moskovitz (pictured above) left the company five years ago to start Asana, a Web tool for team collaboration. Chris Hughes went the political route, joining the Obama campaign in 2008 as its director of online organizing. He recently used some of his Facebook wealth to buy The New RepublicEduardo Saverin, Facebook's original financer, was pushed out of the company in 2005. He later moved to Singapore -- and gained notoriety for renouncing his U.S. citizenship.
                                     The Facebook employees
Not everyone gets to be a billionaire, but Facebook will create thousands of millionaires. The company used an unusual equity structure for its employees, issuing warrants that will turn into shares six months after Facebook's initial public offering. Not all of those warrants will vest at once (employees have to work at Facebook for several years to earn their full share), but Facebook has almost 404 million of them outstanding.
There's a lot of approximation in our math, but here's a rough ballpark: At $38 a share, Facebook's outstanding warrants work out to a take of around $4.3 million per employee.
California and Uncle Sam will carve off a big slice of that pie. Facebook says it expects towithhold at least $4.4 billion from its employees' stock stashes to pay the taxes due on their windfalls.


                                              Instagram's founders

Kevin Systrom (pictured) and Mike Krieger struck gold when they recently sold their 2-year-old photo sharing startup to Facebook in a cash-and-stock deal valued at $1 billion. It was Facebook's biggest acquisition to date -- and the kind of windfall Silicon Valley startups dream about. The deal has grown richer in the five weeks since it was announced: The Instagram crew took home $300 million cash and almost 23 million Facebook shares, a stock stash now worth $874 million. That takes the Instagram deal's value up to almost $1.2 billion.
Systrom and Krieger originally set out to build a Foursquare-like check-in service called Burbn. They "pivoted" toward photo sharing after discovering that's what their users were flocking toward. Instagram attracted 30 million users before Facebook snapped it up. 


                                        The Winklevoss twins

Cameron and Tyler Winklevoss are best known for filing a giant lawsuit against Facebook founder Mark Zuckerberg and Facebook, claiming Zuckerberg stole his idea for the social network from their site, ConnectU. The battle began in 2004 and went on until 2008, when a cash-and-stock settlement deal was struck. (Even then, the appeals dragged on for another three years.)
The twins were granted 1.2 million Facebook shares in a deal valued at the time at around $65 million. Thanks to a five-for-one stock spilt, they're now sitting on 6 million shares -- a $228 million windfall.
                                                  David Choe
One of the most intriguing millionaires to come out of Facebook's IPO is graffiti artist David Choe. He was a personal favorite of Sean Parker, who brought him on to paint Facebook's headquarters. Instead of taking $60,000 for the job, Choe opted for Facebook stock.
"I like to gamble, you know ... I believed in Sean," Choe told Howard Stern in radio interview in February. "I didn't care about Facebook. I'm like, 'This kid knows something and I'm going to bet my money on him.'"
Good bet. No one knows exactly how many shares Choe has -- he declined to comment when we asked -- but the New York Times estimates his holdings at $200 million.
                                                  Microsoft
In 2007, Microsoft beat out major players like Google to buy a 1.6% equity stake in Facebookfor $240 million. At the time, Facebook was valued at $15 billion. Five years later, Facebook's valuation has soared -- giving Microsoft a stake worth more than $1 billion. 

 
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