Unlocking Word Meanings
Read the following words/expressions found in today’s article.
1. Initial Public Offering (n.) [ih-nish-uhl puhb-lik aw-fer-ing, of-er-] – first sale of company shares to the public which makes a private company a public company
Read the following words/expressions found in today’s article.
1. Initial Public Offering (n.) [ih-nish-uhl puhb-lik aw-fer-ing, of-er-] – first sale of company shares to the public which makes a private company a public company
Example: Investors do business
strategies when a new Initial Public
Offering of a company is announced.
2. startup (n.) [stahrt-uhp] – a new company that has a high potential for growth or profit
Example: Google and Apple are
large tech companies that used to be startups.
3. acquisition (n.) [ak-wuh-zish-uhn] – something or someone that has been bought or gained
Example: In 2006, Disney bought
Pixar which is one of its most profitable acquisitions.
4. venture (n.) [ven-cher] – a new activity, project or business
Example: Nowadays, tech
companies are investing in mobile application ventures.
5. mobile (n.) [moh-buhl, -beel] – cellular phone, the industry related to cellular phones
Example: People like to take
pictures on their mobile and posting
them on Facebook or Twitter.
Article
Read the text below.
Facebook faces a
problem that most companies would like to have: What to do with so much
money?
Earlier this year,
Facebook decided to buy Instagram, the popular social network that allows
people to share photos taken on their mobile phones. Analysts expected Facebook
to earn even more money after selling its stocks to the public last May 18.
The company was expected
to earn around $10.3 billion from the IPO (Initial Public Offering), increasing its value to more than $100
billion.
With all that
additional cash, the company could buy startups
like Path, or other social networks like Twitter. However, Facebook says the
money won’t be used for anything other than working capital and general
corporate use.
Zuckerberg insists
in a blog post that they won’t be making any more huge acquisitions. In its official filings, Facebook has no concrete
plans on how to spend the money outside of its operations. All the money will
be used as a working capital and general corporate purposes including paying
taxes.
Rocky Agarwal, an
independent analyst, says Facebook does not really need the money from the
IPO, but he would love to see Facebook invest in television and the payment
space.
Venture capitalist John
Malloy, on the other hand, thinks Facebook should be careful about its
investments, especially after the IPO. He says Facebook should concentrate on
its core areas and only invest in things related to those core areas. One of
its core areas is mobile, which
explains why Facebook bought Instagram.
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Viewpoint Discussion
Enjoy a discussion with your tutor.
Discussion A
·
If you were part of Facebook’s management, how
will you spend the company’s money for more profit?
·
Would you invest your money in internet
businesses like Facebook or Twitter?
Discussion B
·
Have you ever tried buying stocks? Why or why
not?
·
What are the things that one should think of
before buying a company’s stocks?