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1.Take Facebook as an example, it debuted with 421 million shares at IPO and now it has 2.8 billion shares. It hasn't made any stock split since IPO so does its number of shares outstanding increase because of new share issuance only, or is there any other factor? How to know when the company issues new shares or how the company issues new shares after IPO? (since I can't find any sources/news to justify in Facebook case)

2.After IPO, if the company wants to issue more stocks, does it issue at the market value?

3.When the company goes public (IPO), how do shareholders keep their company ownership with such tremendous participation from the public?

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The float is the number of shares sold to the public. For Facebook, it was 421 million shares. The rest of the shares are owned by venture capitalists with the vast majority owned by Zuckerberg (about 28%).

The are two types of secondary offerings.

  • A dilutive secondary offering involves creating new shares and offering them for public sale, usually near current price.

  • A non-dilutive secondary offering involves sale of existing shares by major stockholders who receive the proceeds. This is what happened when Facebook sold 71 million shares to the public (41 million by Zuckerberg).

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  • does it mean that the public only owns 421 million shares in 2.8 billion shares now? And there's about 2.4 billion shares distributed within the company over the years? – Ethan Allberton Oct 30 '20 at 3:38
  • It means that when the company went public, 2.8 billion shares were issued. Insiders controlled 2.4 billion and 421 million were offered to the public. The only change that occurred was the non-dilutive secondary that I mentioned. – Bob Baerker Oct 30 '20 at 3:51
  • I see. Then does the public include Index/Mutual Funds and individual stakeholders? According to this statistic: (money.cnn.com/quote/shareholders/…) ASSENAGON ASSET MANAGEMENT bought 1.7 Million shares of Facebook Inc on 9/30/2020. This is not traded public but inside the company right? – Ethan Allberton Oct 30 '20 at 4:17
  • Note that companies can issue shares in a private placement before it does its IPO. You'll have to do some Googling to determine who bought what early on and who holds what at this point in time. – Bob Baerker Oct 30 '20 at 12:08
  • How did insiders keep/own 2.4 million stocks..? what do they pay? face value, premium or none.? @BobBaerker – rbyndoor Jan 25 at 14:10
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  1. After IPO, if the company wants to issue more stocks, does it issue at the market value?

Yes - it sells the new shares to the public for whatever they're willing to pay for it. Technically there's often an intermediary that buys all of the shares then help distribute them in the secondary market (since Facebook is not in the stock trading business), but the initial price is what the intermediary thinks they'll be worth on the open market.

  1. When the company goes public (IPO), how do shareholders keep their company ownership with such tremendous participation from the public?

They either keep a class of shares that does not dilute when new shares are issued, or they just accept the loss in ownership percentage by having a smaller piece of a bigger pie.

If you owned 10 shares (10%) of a farm worth $100, and the farm issued 100 more shares (say to buy more land) for another $100, you'd still own 10 shares (5%) of a company that's now worth $200. So your total value stays the same even though you have half of the ownership (percentage-wise) that you did before.

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