Facebook is set to go public Thursday in what's expected to be a monster initial public offering. The cash haul for Wall Street will likely be huge -- a whopping 33 underwriters are supporting the IPO -- and investors are taking a hard look at the company and its potential on the markets.

Let's get one thing out of the way first: Unless you have plenty of zeroes in your bank account, you probably can't get in on the IPO. There are a bunch of cooks in this kitchen already, and they're going to grab as much of the meal as they can for themselves and their friends.

Facebook is trying to open up the IPO to smaller investors, but in all likelihood most of us won't get a chance to buy until the first day of trading, which will probably be Friday.

With that said, here's what you need to know about the initial public offering:


Facebook officially is supposed to price at between $28 and $35 a share. Late Monday, The Wall Street Journal said the price range has been raised to $34 to $38 a share, the richest valuation even for an American company going public. That could make the company worth as much as $104 billion. The actual price won't be set until late Thursday, and it depends on several factors, including investor enthusiasm. If we go with the midpoint of that range and assume the price is $31.50 a share, the IPO will raise about $5.6 billion for Facebook (or $5.8 billion if the underwriters exercise their right to buy more shares to cover over-allotments). If the price range is $34 to $38, the cash raised jumps to $11.5 billion to $12.8 billion.

What's being offered

Facebook is offering 180 million shares. The selling stockholders are offering 157.4 million shares for a total of about 337.4 million shares of Class A common stock. Each Class A share gets one vote. A separate class, Class B, gets 10 votes per share.

Common shareholders will have pretty much zero say in the direction of the company. That's because the people who hold Class B shares -- co-founder Mark Zuckerberg and other honchos -- will wield 96% of the voting power. Zuckerberg alone will have 57% of the voting power. So whatever he says goes -- common shareholders just are along for the ride.

What's Facebook worth?

The IPO is estimated to value Facebook at as much as $96 billion. That would make it almost as valuable as Amazon.com (AMZN) and more valuable than McDonald's (MCD). Is it worth all that?

Keep in mind that many investors are not buying Facebook because of where it is today, but where it's expected to go in the future. And there's much room for growth: The company already has more than 900 million users and is fast expanding into large markets, including Brazil, India, Japan and South Korea. In Brazil, for example, Facebook saw a 180% increase in monthly active users in the past year. The downside of some of these emerging markets, however, is that they don't contribute as much revenue per user as more developed markets.

What do the numbers say?

Plenty. The good news is that the company is profitable and growing. Revenue hit $3.7 billion last year, up from $1.9 billion the year before. And profit rose to $1 billion last year from $606 million the year before. The average revenue per user was $1.21 in the first quarter, 6% more than a year earlier.

The downside is that the numbers are slowing. Revenue growth fell from 154% to 88% to 45% over three consecutive years. Profit is falling as well. First-quarter profit was $205 million, down 32% from the preceding quarter and 12% from a year earlier.

What are the risks?

There are plenty. Facebook relies too much on advertising; 85% of its revenue comes from advertising, in fact. And Facebook still doesn't have a good way of making money from the fast-growing user base connecting through smartphones. Facebook doesn't really have any mobile ads or mobile revenue.

It relies too much on one customer, Zynga (ZNGA), for revenue. In fact, 15% of its revenue in the first quarter was related to the online gaming company. Finally, Facebook has no plans to offer a dividend, which means shareholders can count on only share price appreciation for any gains.

How can I buy?

This is a little tricky. Facebook seems to be trying to open up the IPO to smaller investors. What else would explain its last-minute decision to allow E-Trade Financial to underwrite the offering (along with more than 30 others)? E-Trade has set up a website for customers to participate in the offering, and customers will reportedly be asked how many shares they want to purchase and how much they're willing to pay. There's no guarantee that the customers will get what they want, however.

Other brokerages will likely offer Facebook shares to only the most well-heeled and active customers. Fidelity Investments, for example, opens up IPOs to customers with at least $500,000 in its accounts and who have made at least 36 trades in the last year, CNN reports.

Another option for small investors is to find a mutual fund that holds Facebook shares. Many mutual funds already own private Facebook shares. It stands to reason that they will be holders after the IPO as well.

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Some funds holding private Facebook shares include Morgan Stanley Focus Growth A (AMOAX) and Fidelity Contrafund (FCNTX), as well as the smaller Pax World Balanced Individual Investor (PAXWX) and Tocqueville Opportunity (TOPPX), the Associated Press reports.

What's the bottom line?

Facebook's IPO is expected to be the largest Internet offering in quite some time. As with any IPO, you just never know how the markets will respond. Some Groupon (GRPN) investors thought they were getting a great deal, but the stock price has been halved since the IPO. On the other hand, Google (GOOG) priced its IPO at $85 a share, and now the stock sells for more than $600.

There are many question marks around Facebook, a young company that has grown so far so fast. There's risk in the shares, and IPO investors could find themselves richly rewarded -- or tremendously disappointed.