Trickle-down Zuckonomics and the Facebook IPO hackathon
As Mark Zuckerberg gets ready to ring a bell tomorrow ushering in the company's $100 billion IPO, its employees are readying a night of coding, and possibly months of spending.
If you want to know where the most famous hoodie-wearer in the world will be Friday morning, he'll be ringing a bell in Hacker Square.
Hacker Square is more or less the center of Facebook's Menlo Park, Calif., headquarters, and features a giant "HACK" in the cement that's large enough to be seen from space. The man with the hoodie is, of course, Facebook CEO Mark Zuckerberg. At 6:30 a.m. PT tomorrow, a source told CNET, Zuck will stand by a big crane in the square and ring a ceremonial bell in time with the opening of financial markets in New York -- and the launch of the social network's hotly-anticipated IPO.
As has been well chronicled, Facebook's IPO is expected to give the company a market cap of around $100 billion, $18 billion of which will be in the hands of Zuckerberg himself. But don't expect the 27-year-old to start wearing suits any time soon. If he wasn't going to wear one to recent investor meetings, he's not likely to start now.
What he will be doing is celebrating the merger of the world's largest social network and Wall Street, and, perhaps wiping crumbs and pizza stains off his hoodie after an all-night hackathon that start at 7 p.m. PT tonight at Facebook HQ.
Though it's unknown if Zuck himself will be taking part, it's pretty clear that hordes of the company's employees will be staying up all night for Facebook's 31st hackathon. Taking place in Hacker Square, the all-night coding session will give participants the chance to geek out on any project they want. So long as it's different from their day job. This being the 31st hackathon, pretty much anyone at Facebook can take place. In days gone by, only the company's engineers got the privilege of exhausting themselves during a night of cold pizza and warm beer. And code. Lots of code.
CNET's complete coverage: Facebook's monster IPO
The goal of the hackathons, CNET's source said, is for Facebook employees to look for new ideas that may some day turn into their full-time projects. It doesn't happen too often, but things such as Facebook's "Like" button and a very early iteration of the Facebook Timeline emerged from these bacchanalias.
Then again, most of these people are about to take part in the American Dream tomorrow. With Zuckerberg's ringing of the bell in the morning, a lot of these people are going to become -- on paper, anyway -- kind of rich.
What does that mean for the businesses of Silicon Valley? Well, it's hard to know for sure right now, since those thousands of pre-IPO geeks won't be getting their hands on any actual money until after the so-called "lockout period" ends in either three or six months, depending on who they are. But it is clear that retailers and high-end goods dealers are licking their chops in anticipation of what might be called trickle-down Zuckonomics.
For example, Tony Abiog, a sales consultant at Carlsen Porsche, located just down the street from Facebook HQ, said he "definitely" expects some Facebook shoppers after the IPO, and especially after the lockout period ends. But already, Abiog said, at least two Facebookers have swung by, perhaps to salivate over the cars they hope to be getting in just a few months.
Over at Barbecues Galore in Palo Alto, Calif., it's much the same story. According to store manager Adam Sayers, employees there have been discussing their hope that newly-wealthy Facebookers will come ambling in, looking to plop down as much as $20,000 on something to cook burgers and steaks on, like the Fire Magic Island.
Summer is usually the store's high season, but Sayers said that, "With all the talk [the Facebook IPO] happening soon, we're hoping our big season gets bigger."
When it comes to real estate, you might think that with newfound millions in their pockets, Facebook employees would be getting ready to rush out and buy fancy new houses. And that may well be true. According to Pierre Buljan, who sells high-end homes with Coldwell Banker, calls have indeed been coming in -- mainly because Facebookers probably see the firm's ads in various fancy house magazines -- but he thinks that there will be a lull before the deals start going down.
In part, Buljan said, that's because there's a sense among his colleagues that "the old guard is teaching the new millionaires not to go out there in droves... because they're going to be bidding against each other."
At the same time, he added, there's a caution among people who will be making big IPO money that they need to wait until they have the cash in hand before buying something like a house because they don't want to assume that the stock's price will hold up until the lockout period is over. During the dot-com bubble, Buljan said, there were many cases of people buying $5 million houses when their companies went public only to see their shares lose all their value by the time they were out of lockup.
That, of course, is unlikely in this case. Facebook has many of the intangibles that suggest a successful stock, and so Silicon Valley is very likely to have a bunch of new rich people living there.
And it all starts tomorrow morning, when Mr. Hoodie rings a bell by a crane, and the janitorial staff starts picking up all the empty pizza boxes after almost 12 hours of the kind of coding that can only happen thanks to the dream of impending wealth -- plus a whole lot of taurine.