Facebook, the world’s leading social network, filed for an initial public offering of $5 billion on Wednesday (February 1), raising hopes for a revenue windfall in the company’s home state of California.
“If it is as big as it is being billed, then on behalf of a grateful state, I will go to Mark Zuckerberg’s house and either wash his windows or mow his lawn,” a spokesman for Governor Jerry Brown tells The Associated Press, referring to Facebook’s founder and chief executive.
California is still mired in fiscal crisis, with a budget shortfall of more than $9 billion. But the conversion of Facebook from a private to a public firm could bring as much as $1 billion in new revenue for the state, according to estimates from nonpartisan legislative analysts. The state would see the money as a result of the taxes it levies on Facebook employees and investors who profit from their stock transactions, according to the AP.
The Wall Street Journal notes that Facebook hopes to raise $5 billion in its IPO, but the paper says “that figure is a placeholder and will likely grow,” meaning California could see even more revenue than is now projected.
Meanwhile, the state budget may not be the only beneficiary. Even California’s troubled housing market could make gains. ABC News reports that real estate officials in and around Facebook’s headquarters in Menlo Park, a suburb of San Francisco, are preparing for an uptick in home purchases.
“It’s very simple,” a developer tells ABC. “The Facebook IPO will create in an instant multiple millionaires who, when they sell their stock to cash out, will be looking for higher-end properties in and outside San Francisco.”
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