We screwed up our IPO because we wanted to screw Wall Street.
That’s the explanation recently delivered by Facebook (FB: 19.44, +0.00, +0.01%) chief operating officer Sheryl Sandberg to at least one prominent institutional investor about how the social media network so badly misjudged investor demand and flubbed its much-hyped initial public offering in May.
Shares of Facebook have declined more than 50% from its IPO high, and company officials have recently launched a charm offensive with large institutional investors to try and entice them back into the stock amid growing market discontent about the company’s future prospects, and the ability of management, particularly the company’s 20-something CEO Mark Zuckerberg, to deliver future earnings growth.
The flubbed deal has had far-reaching implications, making already skittish small investors even more hesitant to jump into the stock market.
In addition, FOX Business has learned that Facebook competitor Twitter is reevaluating the timing for a possible IPO following Facebook IPO’s problems. A person with knowledge of Twitter’s plans says any IPO could be a year away, as senior management determines how best to deliver earnings as a public company. Company founder Jack Dorsey is working with JPMorgan (JPM: 37.23, -0.60, -1.59%) CEO Jamie Dimon on Twitter’s future, this person says.
A spokesman for Twitter had no comment. A JPMorgan spokesman also had no comment.
Sandberg, 42, has been widely regarded on Wall Street as Facebook’s “adult in the room” largely for the decade she spent as a senior executive at tech giant Google. But some of her recent remarks about Facebook’s ill-fated IPO have large investors and Wall Street analysts questioning her abilities as well.