Who’s Developing the Next Billion-Dollar IPO?

Billion-Dollar IPO | BCBusiness
Facebook’s IPO valued the company at more than $100 billion. Who’s developing the next billion-dollar IPO?

A 20-year-old is surely developing the next billion-dollar IPO right now.

On May 18, Facebook’s mammoth IPO took the company public, valuing it at more than $100 billion and making a bazillionaire out of Mark Zuckerberg, not quite 30 years old. I know what you are thinking: it’s July, and you already know this. Such is the reality of magazine lead times. The fact remains, though: there are now only a handful of technology companies larger than Facebook. How will the behemoth known as Facebook affect the world, the technology industry and, most importantly, B.C.-based technology companies?

The Internet is certainly living up to the hype of 15 years ago, what with 2.2 billion souls using it now. The first 10 million users needed an organized taxonomy to find stuff. Yahoo was the first to do it in a big way, and the company got its own IPO in 1996, making two former graduate students very rich. Then, the next 200 million came online, and things got hard to find. Search engines emerged, but were not great at finding anything meaningful, until Google showed up on the scene. It added context to searching and helped you find what you wanted, faster. Google became very large, and got its own IPO in 2004, making two more former graduate students very rich.

Facebook was the winner in the web 2.0 battle over social networking. With a billion of us online, we needed better ways to engage with one another. We don’t have to leave the friendly confines of Facebook to be entertained, making it the most engaging platform to date. Guess what? Facebook, too, became a very large company and, with its own IPO in 2012, made a former undergraduate student very rich. Do I sense a pattern?

Facebook has become a platform for connecting, sharing, playing, communicating and consuming. It makes money from advertising and transactions that happen inside the platform by knowing the most intimate things about its users. But while it is huge and seemingly omnipresent, there are a few things that Facebook is not. It isn’t a work productivity platform. You still need software tools that are not offered by Facebook to get things done in the real world. Facebook has been lagging behind in extending its platform to the smartphone. And, as you should probably expect by this point in this column, there is a student somewhere, right now, creating the next big thing, that will be bigger than Facebook. And, it will go public by 2020. Without a doubt.

For now, though, Facebook is a dominant media platform. Which B.C. companies will leverage Facebook’s platform for profit? KITN Media was the first company to monetize the games appearing within Facebook, with its Super Rewards platform serving as an interface between virtual currency and real money. The Vancouver company was bought by Kansas City-based AdKnowledge, in 2009, for $30 million, which was perfect timing since, 18 months later, Facebook produced its own platform for converting virtual money to real. East Side Games has made a handsome living with hit Facebook games like Pot Farm (seriously). Ayogo Games makes many Facebook games with educational or health and wellness values underlying them. A novel little startup called Tradable Bits makes money creating customizable applications that anyone can use to jazz up their Facebook pages (polls, slide shows, news, etc.). Over 24 million Facebook visitors use Tradable Bits apps each month. Local technology rocketship HootSuite embraced Facebook from a personal- and business-user perspective, allowing effective control and analysis for posting content, links and updates to Facebook, Twitter, LinkedIn and Google+, all at the same time.

The next big thing is being developed right now. Someone is thinking hard about what Facebook is not doing and about what five billion people will want from a massive network that is available everywhere. And I want early stock in it.