Annualized return he made on his investment up to ipo point

Assignment Help Financial Management

Reference no: EM131300711

Few IPOs have garnered as much attention as social media giant Facebook’s public offering on May 18, 2012. It was the biggest IPO in internet history, easily topping Google’s IPO eight years earlier. Let’s take a closer look at the IPO itself, as well as the payoffs to some of Facebook’s early investors.

Begin by navigating to the SEC EDGAR Web site, which provides access to company filings: https://www.sec.gov/edgar.shtml. Choose “Company Filings Search” and pick search by “Company Name”. Enter “Facebook” and then search for its IPO prospectus, which was filed on the date of the IPO (May 18, 2012) and is listed as filing “424B4” (this acronym derives from the rule number requiring the firm to file a prospectus, Rule 424(b)(4)). From the prospectus, calculate the following information:

Facebook had only one angel investor, Peter A. Thiel (the founder of PayPal). Mr.Thiel invested more than once in Facebook, both as an angel and, in later rounds, on behalf of investors in his venture capital fund, Founders Fund. As an angel, Mr.Thiel invested $500,000 in September 2004. Assuming that all the shares he received in the angel round were registered under the name Rivendell One LLC, use the information in the prospectus (again, in the “Principal and Selling Stockholders” section, see the footnote (16) attached to Peter A. Thiel ) to calculate:

A) The per share price he paid as an angel.

B)The annualized return he made on his investment up to the IPO point (again, using the IPO offer price as selling price). Note that the holding period return is about 92 months in this scenario.

C)The amount of money Mr.Thiel would have received from the IPO, if all shares he held under the Rivendell One LLC were sold at the IPO price.

Reference no: EM131300711

Questions Cloud

What would be your levels of expectancy : 1. What would be your levels of expectancy? Which outcomes would have high valence for you on this job? 2. What steps would your manager take to make sure you feel that you were being equitably treated? What would you do, if after a year on the job..

Provide two specific example of the balanced scorecard model : Provide at least two specific examples of the Balanced Scorecard Model that apply within a health care organization with which you are familiar.

How would you address the challenges with data warehousing : How are health care providers and payor organizations applying analytics today?How would you address the challenges with data warehousing?What forward-looking analytics innovations can health care organizations apply to meet their mounting challenge..

Estimate the temperature the plate reaches : If the top surface of the plate is well insulated, estimate the temperature the plate reaches when the ambient air is quiescent and at a temperature of 0°C.

Annualized return he made on his investment up to ipo point : Few IPOs have garnered as much attention as social media giant Facebook’s public offering on May 18, 2012. It was the biggest IPO in internet history, easily topping Google’s IPO eight years earlier. The per share price he paid as an angel. The annua..

Engaging in high-risk leisure activities such as skiing : Smoking cigarettes? Engaging in high-risk leisure activities such as skiing, motocross racing, rock climbing, or sky diving? Having a romantic affair outside of the marriage relationship?

Describe the effect that the presidential doctrine has had : Define presidential doctrine and summarize the regional or global events during the Cold War. Describe the effect that the presidential doctrine has had on regional or global affairs since it was announced during the Cold War.

Political foundations of the movement : What were the social, economic, political foundations of the movement? What judicial, political, or legislative strategies were adopted to accomplish its goals? How/why were they successful?

Business applications of wireless networks : Using what you have learned about the business applications of wireless networks and the benefits of the mobility that it allows, develop a completely mobile and wireless class for the future. Take into consideration the following:

User Account

All Pages