Facebook files for IPO, could raise $10 bn

Facebook, the social networking giant, has filed an initial public offering which could raise as much as $10 billion and could value the company between $75 billion and $100 billion.

However, the company said it plans to raise $5 billion in its stock sale, the largest public offering on the history of a web company.

Also, Facebook for the first time gave potential investors a glimpse into its financial structure.

In its filing before the Security and Exchange Commission, Facebook said in 2011 it generated revenue of $3.71 billion, which is an increase of 88% from $1.97 billion the year before and 377% from 2009.

In 2011, its income was $1 billion an increase of 65% from 2010’s $606 billion. Facebook derives 85% of its revenues from advertising, and the rest from social gaming and other fees.

"The company hopes to raise as much as $10 billion when it begins selling shares this spring ...," The Wall Street Journal said in a report.

Founded in 2004 by CEO Mark Zuckerberg, Facebook now has some 845 million active users who in all upload 250 million photos a day.

According to the filing, Zuckerberg made a salary of $483,333 last year, in addition to a $220,500 bonus for the first half of 2011.

"The paperwork portrays a company that makes the vast majority of its money from selling display ads targeted to its users who have revealed to Facebook much about their lives," the Washington Post reported.

Facebook is expected to file its paperwork several times over the next few months, updating the information it provided to the SEC on Wednesday.

Meanwhile in a letter to potential investors, Zuckerberg said Facebook thinks a more open and connected world will help create a stronger economy with more authentic businesses that build better products and services.

"As people share more, they have access to more opinions from the people they trust about the products and services they use. This makes it easier to discover the best products and  improve the quality and efficiency of their lives," he wrote.