Facebook IPO: Mark Zuckerberg's salary falling to $1 in 2013

With Facebook's S-1 filed with the Securities and Exchange Commission for what is set to be a blockbuster IPO worth at least $5 billion in May, Mark Zuckerberg is now firmly sitting among Silicon Valley's top chief executives, if he wasn't already.

And, probably with that in mind, Zuckerberg is falling in line with a tradition among some of the valley's top CEOs: a $1 annual salary.

Zuckerberg received a $500,000 salary in 2011 and he'll get a $100,000 raise to $600,000 this year, Facebook's S-1 filing said. Zuckerberg also received a $220,500 bonus in the first half of 2011, the filing said.

"In the first quarter of 2012, our compensation committee discussed and approved a request by our CEO to reduce his base salary to $1 per year, effective Jan. 1, 2013," the document said.

Zuckerberg asked for the dramatic salary cut in the first quarter of 2012, according to the S-1, which would mean he made the request sometime in January, given that the document was filed Feb. 1.

The pay cut falls in line with the $1 annual salary taken by Steve Jobs from 1997 until his death last year as Apple's chief executive, and the $1 annual salaries taken by Google's former and current CEOs, Eric Schmidt and Larry Page; Larry Ellison at Oracle; and Meg Whitman at Hewlett-Packard.

But make no mistake, the 27-year-old Zuckerberg is being compensated for his leadership of the world's largest social network in many other ways -- not the least of which is Zuckerberg's 28% stake in Facebook, a company valued at as much as $100 billion.

Facebook, for example, has paid for a home security system and "security personnel" for Zuckerberg, the S-1 said.

"Because of the high visibility of our company we have implemented a 'comprehensive security program' for Mr. Zuckerberg to address safety concerns resulting from his position as our founder, chairman and CEO," the filing said. "We require these security measures for the company's benefit because of the importance of Mr. Zuckerberg to Facebook, and we believe that the costs of this comprehensive security program are appropriate and necessary. We paid for the initial procurement, installation and maintenance of security measures for Mr. Zuckerberg's personal residence, and we pay for the annual costs of security personnel, neither of which constitutes taxable income to Mr. Zuckerberg."

The company also "has also authorized our CEO and COO to use private aircraft for business purposes," the S-1 said. "This practice maximizes such executives' productive time and ensures their quick availability. In addition, Mr. Zuckerberg may use private aircraft for personal purposes in connection with his comprehensive security program. On certain occasions, Mr. Zuckerberg may be accompanied by family members or others when using private aircraft.

"For flights involving passengers flying for personal purposes, the aggregate incremental cost of such personal usage is reported as other compensation to Mr. Zuckerberg. The reported aggregate incremental cost is based on costs provided by the applicable charter company and includes passenger fees, fuel, crew and catering costs. The incremental cost attributable to Mr. Zuckerberg's use of private aircraft in 2011 is disclosed in the 'All Other Compensation' column in '—2011 Summary Compensation Table.'"

Zuckerberg's "Other Compensation" in 2011 totaled $783,529, the filing said, with about $692,679 going "to personal use of aircraft chartered in connection with his comprehensive security program and on which family and friends flew during 2011." The remaining $90,850 was for "costs related to estate and financial planning during 2011," the filing said.

RELATED:

Facebook files for IPO

Mark Zuckerberg: Know Facebook's social mission before investing

Facebook IPO: Mark Zuckerberg says 'Stay focused & keep shipping'

-- Nathan Olivarez-Giles

Nathan Olivarez-Giles on Google+

Facebook.com/nateog

Twitter.com/nateog

Photo: Mark Zuckerberg, Facebook's co-founder and chief executive, speaks at the company's F8 developers conference in San Francisco in September 2011. Credit: David Paul Morris / Bloomberg

Facebook's S-1 already has a (fake) Twitter account

Just moments after Facebook filed its long awaited S-1 on Wednesday afternoon, the S-1 itself got its own Twitter feed.

"Hey, I'm new here," it began, simply enough. And shortly thereafter, it tweeted, "Hey! Anything interesting happen today? LOL!!!"

No clever names for this silly feed -- just the straightforward @FacebooksS1. It's profile says it was born on February 1, 2012, and lists its location as Menlo Park, CA.

Can't argue with that!

Facebook's S-1's self-assigned task seems to be responding to any online remarks it can find about itself, which in the initial crunch immediately following the filing came mostly from the tech media.

When Alexia Totsis of TechCrunch tweeted "This Facebook S-1 is like an animal carcass and us bloggers are like a pack of rabid wolves," Facebook's S-1 responded: "Animal carcass?! WTH? I work out."

And when New York Times tech reporter Jenna Worthman tweeted, "curious: Facebook is alternately capitalized and written in lower-case throughout the filing." Facebook's S-1 shot back: "I like to keep it edgy."

Of course it took just about, oh, a couple of hours or so, for everything to start getting meta.

Just before 5 p.m. Pacific time, Josie Mora (@uncouthgormand) tweeted that she would be printing the Facebook SEC S-1 report, which she expected would be a fascinating read. Her friend @KrisDub wanted to know if Facebook's S-1 would be cool with her looking at its private parts.

Facebook's S-1 didn't miss a beat. "Whoa, ladies," it tweeted. "This is a G-Rated filing here. Except for the value of Zuck's shares. That's just obscene."

ALSO:

Facebook files for IPO

Facebook IPO: from a dorm room, to 800 million users, to an S-1

Mark Zuckerberg: Know Facebook's social mission before investing

-- Deborah Netburn

Image: A screen grab of Facebook S-1's twitter feed.

Facebook's IPO will put Zuckerberg's 'open, connected' mantra to the test

Almost exactly eight years ago today, on the first Wednesday of February 2004, Mark Zuckerberg famously launched thefacebook.com out of his Harvard dorm room.

And now on the first Wednesday of February 2012, the company he built has filed papers for what's expected to be the largest initial public offering ever to come out of Silicon Valley, not to mention one of the largest in U.S. history.

But from dorm room to IPO, Zuckerberg says the vision for his social networking site has remained the same. The goal with the company that has made him billions, he says, has never been about making money, but rather to make the world more "open" and "connected" -- two words he has been known to repeat, like a sort of mantra.

On Facebook's 6th anniversary in 2010, when the networking site had less than half of the 845 million monthly users the company claimed in Wednesday's IPO filing, Zuckerberg  wrote a letter to Facebook users explaining the company's mission: "Facebook began six years ago today as a product that my roommates and I built to help people around us connect easily, share information and understand one another better," he wrote, "...and thanks to you we've made great progress over the last year towards making the world more open and connected."

In a letter to investors included in Facebook's IPO filing, Zuckerberg drilled down on that theme, starting with the first line of the letter:

"Facebook was not originally created to be a company. It was built to accomplish a social mission -- to make the world more open and connected," he writes.

Of course, some are concerned about the lack of privacy in the "open" and "connected" world of the future that Zuckerberg has conceived, and helped create -- especially as Facebook will likely face pressure from investors and Wall Street analysts to turn its biggest asset -- personal information about its hundreds of millions of users -- into bigger and bigger profits.

ALSO:

Facebook files for IPO

Wall Street clicks 'like' on Facebook IPO

Facebook says ticker symbol will be FB, annual revenue $3.7 billion

--Deborah Netburn

Image: Facebook CEO Mark Zuckerberg delivers a keynote during the Facebook f8 Developer Conference in September of 2011. Credit: Kimihiro Hoshino /AFP

Facebook IPO draws an array of user reaction in status updates

No one knows Facebook better than Facebook.

Seconds after the company’s filing for a huge initial public stock offering was announced Wednesday, Facebook users flooded the social network with comments.

“Based on my news feeds, you would think Zuck just took over the world. Oh, Facebook,” said Amanda Coolong, producer of a technology news site.

“OOO What I could give to be able to get in on this,” wrote Alexander Henry Sargent, expressing the oft-repeated hope that shares would be available to the common user.

Other loyal Facebook users simply hoped that they could share in some way in the money that will be made in the buying and selling of the company’s stock.

“To Mark Zuckerberg, founder of this very home called Facebook,” wrote Steve Baxley. “Kudos upon your launch of the IPO. ‘Twould be really fun to give all us Facebookers a little piece of that!”

Freelance writer Michael Shinzaki said that if he could get in on the IPO, he’d wipe out one of the social network’s newest and most disparaged features.

“I think I’m gonna buy 2.5 billion,” he said, “then make an executive decision to revoke the Timelines.”

Some were skeptical of the riches people expected the IPO to generate.

“The amount of value that a company without tangible goods doing what it does (nothing) is amazing really,” wrote Justin Martens. “In the blink of an eye it could be gone.”

Others worried that the IPO might mean fundamental changes for Facebook.

“Well, Facebook is all about the money now,” said a user identified as Scootergoods. “So I would say paying for your membership will happen real soon.”

At least one user saw a moneymaking possibility beyond the stock offering. Guy Blume had a message for any insider about to get rich off the IPO.

“Menlo Park and surrounding towns may see a real boon to local business especially real estate,” Blume wrote. “Looking to buy a home in Silicon Valley? Let me know if I can help.”

RELATED:

Facebook got 12% of its revenue from Zynga

Facebook files finally for initial public stock offering

Mark Zuckerberg: Know Facebook's social mission before investing

-- Matt Stevens

Photo: The Facebook campus in Menlo Park, Calif., now occupies the former Sun Microsystems buildings. Credit: Mark Boster / Los Angeles Times

Facebook IPO: Mark Zuckerberg says 'Stay focused & keep shipping'

Your company just filed papers to sell its stock to the public in what may be the biggest Internet IPO ever that will make you one of the richest people in the world.

So what are you going to do?

Here's Mark Zuckerberg's answer. This is a photo of his desk at Facebook's Menlo Park, Calif., headquarters that he posted Wednesday on his Facebook page.

RELATED:

Facebook files for IPO

Facebook IPO: from a dorm room, to 800 million users, to an S-1

Mark Zuckerberg: Know Facebook's social mission before investing

-- Jessica Guynn

Photo: Mark Zuckerberg's desk at Facebook's Menlo Park headquarters. Photo credit: Mark Zuckerberg

Facebook IPO: from a dorm room, to 800 million users, to an S-1

In eight years, Facebook has gone from the creation of a couple of college kids in a Harvard dorm room, to Silicon Valley golden child, to filing for one of the largest IPOs the U.S. has ever seen.

Although Facebook is in the midst of a milestone day Wednesday, there have been many other important moments in the relatively young life of what has grown into the mostly widely used social network in the world.

Here is a rundown of key moments in Facebook's history, as compiled by the Associated Press:

February 2004: Mark Zuckerberg starts Facebook as a sophomore at Harvard University.

March 2004: Facebook begins expansion to other colleges and universities.

June 2004: Facebook moves headquarters to Palo Alto.

September 2004: Facebook introduces the Wall, which allows users to write personal musings and other tidbits on profile pages. A lawsuit is filed against Facebook alleging that Zuckerberg stole the idea for Facebook from a company co-founded by twins Cameron and Tyler Winklevoss and a third person at Harvard.

September 2005: Facebook expands to include high schools.

May 2006: Facebook introduces work networks, allowing people with a corporate email address to join.

September 2006: Facebook begins letting anyone over 13 join. It also introduces News Feed, which collects friends' Wall posts in one place. Although that led to complaints about privacy, News Feed became one of Facebook's most popular features.

May 2007: Facebook launches Platform, a system for letting outside programmers develop tools for sharing photos, taking quizzes and playing games. The system creates a Facebook economy and allows companies such as game maker Zynga Inc. to thrive.

October 2007: Facebook agrees to sell a 1.6% stake to Microsoft for $240 million and forges an advertising partnership.

November 2007: Facebook unveils its Beacon program, a feature that broadcasts users' activities on dozens of outside sites. Yet another privacy backlash led Facebook to give users more control over Beacon, before Facebook ultimately scrapped it as part of a legal settlement.

March 2008: Facebook hires Sheryl Sandberg as chief operating officer, snatching the savvy, high-profile executive from Google Inc.

April 2008: Facebook Chat is introduced.

February 2009: Facebook introduces "Like," enabling users to endorse other users' posts.

June 2009: Facebook surpasses News Corp.'s Myspace as the leading online social network in the U.S.

August 2010: Facebook launches location feature, enabling users to share where they are with their friends and strangers.

October 2010: Release of "The Social Network," a movie about Zuckerberg and the legal battles over Facebook's founding. It gets eight Academy Award nominations and wins three.

June 2011: Google launches rival social network called Google+. The Winklevoss twins end their legal battle over the idea behind Facebook. They had settled with Facebook for $65 million in 2008, but later sought more money.

September 2011: Facebook introduces Timeline, a new version of the profile page. It shows highlights from a user's entire Facebook life rather than recent posts.

November 2011: Facebook agrees to settle federal charges that it violated users' privacy by getting people to share more information than they agreed to when they signed up. As part of a settlement, Facebook will allow independent auditors to review its privacy practices for two years. It also agrees to get approval from users before changing how the company handles their data.

December 2011: Facebook completes its move to Menlo Park, Calif. Its address is 1 Hacker Way.

January 2012: Facebook begins making Timeline mandatory.

February 2012: Facebook files for an initial public offering of stock.

RELATED:

Facebook files for IPO

Mark Zuckerberg: Know Facebook's social mission before investing

Facebook cites Google+, Twitter among rivals, says growth will slow

-- Nathan Olivarez-Giles

Nathan Olivarez-Giles on Google+

Facebook.com/nateog

Twitter.com/nateog

Photo: In a Jan. 6, 2005 photo, Mark Zuckerberg, right, and friends work on TheFacebook.com, an early version of the world's largest social network in a rented home in Los Altos, Calif. Now called simply Facebook, the website is the world's largest social network. Zuckerberg launched the site in his Harvard dorm room in 2004. Credit: Robert Durell/Los Angeles Times

Facebook: 'substantial complexities' to entering China

Mark Zuckerberg has a Chinese girlfriend and told Oprah Winfrey he was taking Chinese lessons, but that doesn't mean he'll be taking his social media network into China any time soon.

In its IPO filing Wednesday, Facebook Inc. said it would continue expanding its operations abroad and noted that Facebook is currently available in 70 languages and has offices or data centers in more than 20 countries. 

The company noted that while it will "continue to evaluate entering China," the market there has "substantial legal and regulatory complexities that have prevented our entry into China to date." 

"If we fail to deploy or manage our operations in international markets successfully, our business may suffer," Facebook said. "In addition, we are subject to a variety of risks inherent in doing business internationally." 

Those risks, Facebook said, include political, social or economic stability; fluctuations in currency exchange rates; burdens of complying with foreign laws; and difficulties in staffing and managing global operations.

There has been been no secret to Facebook's interest in breaking into China, which has hundreds of millions of Internet users and is relatively new to social networking.

Zuckerberg took a widely publicized vacation to China in December 2010, where he met with top technology executives in Beijing, including the CEO of leading Chinese Web portal Sina Corp. and the chairman of state-owned telecommunications carrier China Mobile Ltd.

The Chinese government has blocked access to Facebook to its citizens since 2009. 

RELATED:

Facebook files for IPO

Facebook says ticker symbol will be 'FB,' annual revenue $3.7 billion

Facebook cites Google+, Twitter among rivals, says growth will slow

-- Andrea Chang

Twitter.com/byandreachang

Photo: Mark Zuckerberg at Harvard University in November. Credit: Kelvin Ma / Bloomberg

Facebook cites Google+, Twitter among rivals, says growth will slow

Facebook Inc. is king of the social media world now, but the tech giant is looking over its shoulder.

In its S-1 filing Wednesday, Facebook said its business was "highly competitive" and that the competition "presents an ongoing threat to the success of our business."

"We face significant competition in almost every aspect of our business, including from companies such as Google, Microsoft and Twitter, which offer a variety of Internet products, services, content and online advertising offerings, as well as from mobile companies and smaller Internet companies that offer products and services that may compete with specific Facebook features," the company said.

Facebook said it also faced competition from "traditional and online media businesses for advertising budgets" as well as social networks such as Google+ and regional sites. Facebook said some of its current and potential rivals "have significantly greater resources and better competitive positions in certain markets than we do."

"These factors may allow our competitors to respond more effectively than us to new or emerging technologies and changes in market requirements. Our competitors may develop products, features or services that are similar to ours or that achieve greater market acceptance, may undertake more far-reaching and successful product development efforts or marketing campaigns, or may adopt more aggressive pricing policies," the company said. "As a result, our competitors may acquire and engage users at the expense of the growth or engagement of our user base, which may negatively affect our business and financial results."

Facebook also said it expected its growth rates to decline in the future. It said annual revenue grew 154% from 2009 to 2010 and 88% from 2010 to 2011.

"Our user growth and revenue growth rates will inevitably slow as we achieve higher market penetration rates, as our revenue increases to higher levels, and as we experience increased competition," Facebook said. "As our growth rates decline, investors' perceptions of our business may be adversely affected and the market price of our Class A common stock could decline."

Here's the S-1 filing.

RELATED:

Facebook files for IPO

Wall Street clicks 'like' on Facebook IPO

Facebook says ticker symbol will be FB, annual revenue $3.7 billion

-- Andrea Chang

Twitter.com/byandreachang

Photo: Facebook's chalkboard wall at its new campus in Menlo Park, Calif. Credit: Mark Boster / Los Angeles Times

Facebook says ticker symbol will be FB, annual revenue $3.7 billion

Facebook Inc. finally filed its long-awaited S-1 on Wednesday afternoon and revealed lots of juicy details about the company. The social media giant also disclosed its ticker symbol, FB, but did not say whether it would be listed on the Nasdaq or New York Stock Exchance -- it could be weeks or months before that is determined.

Here's a quick rundown of Facebook's pertinent numbers, according to the filing: 

Users: 845 million, of which 483 million are daily users

Annual revenue: $3.7 billion

Operating income: $1.8 billion

Profit: $1 billion

If you'd like to dig through the filing yourself, you can find it here. Keep checking back for more updates.

RELATED:

Facebook IPO: 'FB' on Nasdaq or NYSE?

Wall Street clicks 'like' on Facebook IPO

Facebook IPO: Could Facebook be worth more than $100 billion?

-- Andrea Chang

Photo: A worker at Facebook's headquarters in Menlo Park. Credit: Paul Sakuma/AP Photo

Obama and Romney campaigns use Square for fundraising

Barack Obama's use of social media is credited with helping him reach out to voters in a groundbreaking way that helped him win the 2008 presidential race. In 2012, the Obama campaign is eying a new way to reach voters and donors too -- Square.

The president's reelection campaign, as first reported by Politico, is outfitting its staff across the U.S. with the small plastic smartphone credit card readers and mobile payment apps from Square, the San Francisco start-up run by Twitter co-founder Jack Dorsey.

But just as the Obama campaign isn't alone in its embracing of social media this year, it too isn't alone in deploying Square for easier, faster fundraising on the campaign trail. On Tuesday, Republican Mitt Romney's campaign announced it too would be using Square for fundraising in Florida, where Romney is facing rivals Newt Gingrich, Ron Paul and Rick Santorum in a Republican primary.

"We have plans to roll it out nationally but right now we're using Square just in Florida as a sort of beta test," said Zac Moffatt, the Romney campaign's digital director. "The challenge on this sort of thing is never with the technology, it's with the compliance. We're making sure everything we're doing follows fundraising rules and is compliant with the FEC [Federal Election Commission] and that it works well. So, for now, were just focusing on making it all work on this smaller scale, but we'd like to scale this out in time, the right way."

Moffatt said the Romney campaign has been talking to Square about how to best implement the company's card reader and app for "probably about six months. This is one of the challenges we face relative to the Obama campaign -- we have only so much manpower. So we've had to plan this out the right way so that we're using the resources we have in an effective way."

To aid its ability to scale-up its use of Square, the Romney campaign is considering developing its own Square-compatibly app that a supporter could download to their smartphone to make a donation or possibly even collect donations on behalf of the campaign -- but that's an idea that hasn't been finalized just yet, Moffatt said.

The campaign looked to Square for fundraising because of the company's ability to turn a smartphone into what is essentially a mobile cash register with a simple app download and a Square card reader in the headphone jack.

"Ease of use is a big part of why we're using Square," he said. "Anything that reduces the barrier for entry is a No. 1 priority for us. Our apps, well that's something to think through. We still have some things to figure out -- whether or not the Apple is going to take 30% of a donation or not, details like that. But we're always looking to get as close to one touch donations as we can."

For the sake of convenience, Moffatt said, all of the Romney's campaign's Square usage will be iPhone based for now, though Android phones may be added in the future. The "beta test" will take place Tuesday night at the Romney campaign's election party in Florida, he said.

"There will be thousands of people there, so we'll be using Square for merchandise sales and fundraising," Moffatt said. "There will be lots of things like this in 2012 and the question always is, does this technology work for us? We have a lot faith this could be something pretty powerful for us moving forward."

RELATED:

Richard Branson invests in Square

Square Card Case on iOS 5 starts a tab in your pocket

Jack Dorsey emulates Steve Jobs, his 'mentor from afar'

-- Nathan Olivarez-Giles

Nathan Olivarez-Giles on Google+

Twitter.com/nateog

Photo: A demo of Square's card reader and iPhone app in action. Credit: Square