Facebook boss likely to delay IPO to woo more users

Facebook will probably put off its initial public offering until 2012, giving chief executive Mark Zuckerberg more time to gain users and boost sales, three people familiar with the matter said.

Facebook would benefit from another year of growth without the added scrutiny that comes with a public listing, instead of holding an IPO next year as investors speculated, said the three, who asked not to be identified because Facebook doesn't discuss share-sale plans.

Still, Zuckerberg, who holds board control, could push for a stock sale at any time, they said.

Waiting lets Zuckerberg, 26, hone the skills needed to steer a company that issues quarterly results while facing criticism on such matters as user privacy.

Facebook, valued at US$24.9 billion ($34.2 billion), would use the time to propel its user base beyond the 500 million mark reached last month and add to sales that two of the people said may double to at least US$1.4 billion this year from US$700 million to US$800 million last year.

"The burden of being public has never been greater," said Kevin Landis, who manages about US$260 million at Firsthand Funds in San Jose, California, and has invested in the technology industry for 16 years.

"Zuckerberg doesn't have to put his name at the bottom of four 10-Q statements every year and attest that everything in there is true or else he's responsible. The minute it's public, he does."

Jonathan Thaw, a spokesman for Facebook, declined to comment.

Zuckerberg, in an interview last month, said Facebook would go public "when it makes sense".

Some investors had speculated a share sale might happen next year after venture capitalist Jim Breyer, a member of Facebook's board, said in January that the California-based company was not focused on a 2010 sale.

Instead, Facebook's management was trying to woo more users and developers, Breyer said at the time.

Start-ups are often urged to sell shares by employees and investors eager for a return on their equity. In Facebook's case, some of that pressure has been allayed by private sales, often facilitated by such exchanges as SecondMarket and SharesPost, which help find buyers for start-up shares.

SharesPost values Facebook at US$24.9 billion.

Zuckerberg faces a range of challenges, including management of a rapidly growing workforce and rising competition.

- BLOOMBERG