If you “like” Facebook, you may love the fact that the company is going public.
On Wednesday, Facebook filed documents with the Securities and Exchange Commission for a $5 billion IPO or initial public offering of stock, according to CNN.
So what exactly does this all mean?
CNN Business Correspondent Christine Romans explains, “It’s when, say I own a hot dog stand and my hot dog stand is getting bigger and bigger and I need new investors to meet up the demand. So I go find an investment banker and I say sell shares to the public cause I would like them to invest in my hot dog stand.”
The social network was conceived in a Harvard dorm room by Mark Zuckerberg in 2004.
Facebook now has 800-million followers.
The company made most of its money through advertising and had never released its financial statements because it was a privately held company.
As a result, there’s no telling exactly how much Facebook’s stock will be worth on the open market. But experts predict based on estimates alone, it’s reported IPO stock will be one of the largest in history.
Once Facebook goes public, investors would not be able to buy shares right away. It will be at least two months before anyone could get a piece of the world’s largest social networking site.