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A sign outside of the Nasdaq Marketsite in Times Square welcomes Facebook. Mark Zuckerberg, wearing his trademark hooded sweatshirt, remotely rang the bell to open trade in the company. © AFP/Getty Images Spencer Platt

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Hoodie-wearing Zuckerberg kicks off Facebook IPO

A sign outside of the Nasdaq Marketsite in Times Square welcomes Facebook. Mark Zuckerberg, wearing his trademark hooded sweatshirt, remotely rang the bell to open trade in the company. © AFP/Getty Images Spencer Platt

NEW YORK, May 18 – Mark Zuckerberg, wearing his trademark hooded sweatshirt, remotely rang the bell to open trade Friday on the Nasdaq, marking a record-setting public offering for Facebook.

Amid a crowd at the social network’s California headquarters, Zuckerberg and hundreds of Facebook employees cheered as the 28-year-old co-founder rang the bell for the New York-based Nasdaq.

Facebook shares were to start trading later in the day in the richest-ever initial public offering for a technology firm.

Zuckerberg was surrounded by hundreds of Facebook employees, many also wearing hoodies, at the Menlo Park campus, celebrating the opening which brings huge fortunes to many associated with the firm.

Zuckerberg wore a dark hooded sweatshirt, unfazed by criticism from some on Wall Street about his casual attire. And most of those on hand for the ceremony were wearing hoodies or T-shirts.

The company’s stock, priced at $38 per share, was to begin trading under the symbol “FB” on the Nasdaq, giving the leading website a dizzying value of $104 billion at its market debut.

The IPO raised more than $16 billion, making it the richest after that of financial giant Visa in 2008, according to Renaissance Capital. The addition of a possible stock “over-allotment” could boost the total to $18.4 billion.

Facebook itself is selling 180 million shares and early investors in the company the remaining 241 million.

With a market value of $104 billion, Facebook would be among the most valuable US companies, ahead of sector giants Amazon ($98 billion) and Cisco ($89 billion), and more than twice the value of Ford Motor Co. ($38 billion).

But it remains behind Google ($203 billion) and Apple ($495 billion).

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Facebook employees staged a software coding “hackathon” at the company’s offices in the Silicon Valley city of Menlo Park overnight ahead of the market opening.

Under the share plan, Zuckerberg, who began Facebook with classmates at Harvard in 2004, will hold 55.8 percent of the voting power of Facebook shares, and over 18 percent of the value of the company, which he controls through a dual class stock structure.

Wall Street and investors around the globe have been girding for a Facebook IPO frenzy over the past few days as Facebook boosted the estimated price for its shares and added to the number being offered by insiders.

Wedbush Securities analyst Michael Pachter said he believed that despite the large number of shares being offered, Facebook’s stock price will climb quickly.

London-based Hargreaves Lansdown Stockbrokers said Facebook may have a hard time living up to lofty expectations but pointed out that it is “a relatively developed company which can display ‘real’ income and profit.”

“There are extremely high expectations for the company’s prospects and perhaps on that basis it deserves the punchy valuation it has been given,” the brokerage said in a note to clients.

But the brokers said Facebook faces challenges including how to make money from the growing base of mobile users.

One of the shadows hanging over Facebook is concerns over privacy.

Some 900 million people use Facebook. But when they realize their private information is being bought and sold, some don’t like it so much.

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Some consumer and privacy advocates say Facebook has been too loose with user data, and hope that as a publicly traded company, it may change its tune.

Zuckerberg has repeatedly apologized for privacy lapses amid outrage from users over revelations their online activities were visible to a wide audience of advertisers and other users.

Late last year, in a settlement with the US Federal Trade Commission, the social networking giant promised to honor users’ privacy preferences and to stop making claims about the security of personal information that are untrue.

The IPO’s net proceeds to Facebook are estimated at $6.4 billion. The rest of the cash goes to Facebook insiders and others who made early investments in the social network, and to cover the IPO costs.

The Wall Street Journal said 57 percent of shares will be from insiders, which is an unusually high percentage. Under Wall Street rules, investors have to wait six months to sell any shares not offered at the IPO.

At the heart of the debate about the wisdom of owning a piece of Facebook is how much revenue it takes in.

Revenue vaulted to $1.06 billion in the quarter which ended March 31 — an improvement year-over-year but down about six percent from the previous quarter.

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