NEW YORK — Facebook founder Mark Zuckerberg turns up at business conventions in a hoodie. "Cocky" is the word used to describe him most often, after "billionaire." He was Time magazine's person of the year at 26.
So when he takes Facebook public, why would he follow the Wall Street rules?
The company is expected to file as early as today to sell stock on the open market in what will be the most-talked-about initial public offering since Google in 2004, maybe since the go-go 1990s.
Around the nation, regular investors and IPO watchers are anticipating some kind of twist — perhaps a provision for the 800 million users of Facebook, a company that promotes itself as all about personal connections, to get in on the action.
"Pandemonium is what I expect in terms of demand for this stock," says Scott Sweet, senior managing partner at IPO Boutique, an advisory firm. "I don't think Wall Street would want to anger Facebook users."
The most successful young technology companies have a history of doing things differently. Google's IPO prospectus contained a letter from its founders to investors that said the company believed in the motto "Don't be evil."
Facebook declined to comment, but Reena Aggarwal, a finance professor who has studied IPOs at Georgetown University's McDonough School of Business, believes Zuckerberg will emulate Google's philosophy, at least in principle.
Founders Larry Page and Sergey Brin wanted an IPO accessible to all investors, and said so in their first regulatory filing. Facebook may say something similar when it files to declare its intention to sell stock publicly.
Facebook is expected to raise as much as $10 billion, which will value the company at $75 billion to $100 billion, making it one of the largest IPOs ever. A stock usually starts trading three to four months after the filing.
The highly anticipated filing will reveal how much Facebook intends to raise from the stock market, what it plans to do with the money and details on its own financial performance and future growth prospects.
It has almost become conventional for tech companies to include an unconventional letter when they make their stock market debut. It's widely expected that Zuckerberg, in the very least measure of showmanship, will write one.
But IPO watchers wonder whether there might be a provision specifically designed to give the little-guy investor, even the casual Facebook user who doesn't invest, a piece of the debut. Facebook is a vital part of people's Internet lives and the most successful company in the history of social media.
"There is a feeling that there will be something unique in store for Facebook users," Aggarwal said.
When most companies go public, they let Wall Street investment banks handle everything, with the sweet ground-floor stock price reserved for big institutional investors.
But that probably won't do for Facebook, created in a Harvard University dorm room eight years ago. Or Zuckerberg, whose antiestablishment credentials include spurning a $15 billion takeover offer from Microsoft.
Most IPOs are underpriced, and the stock usually shoots up the first day. Lucky large investors get the basement price and usually a big payday if they sell on the first day. Smaller investors buy on the open market, after the price has spiked, and pay more.
And most early investors do sell. One university research paper found that about 70 percent of the new stock changes hands in the first two days. Banks like large investors because it costs about the same to process an order of 50 shares as 50,000. But William Hambrecht, founder and CEO of WR Hambrecht & Co., a firm that runs IPO auctions, says companies that value their customers benefit in the long run.
"Our argument has always been that true buyers of your stock ought to be your own customer base," Hambrecht said. "As the great investor Peter Lynch said: Invest in what you know."