Facebook IPO May Be Worth $2.45 Billion to the State of California

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You know who is happy about Facebook's IPO, aside from its investors and fanboys? The state of California. The Golden State has been plagued by bad news about its budget, but a new estimate from the state of California's Legislative Analyst's Office suggests that the Palo Alto company's move to public markets could drop an extra $2.5 billion into the state's coffers, including a whopping $1.5 billion in 2012-2013.

The LAO made sure to caveat its estimate with all detailed notations of the uncertainties in their model. "As we discussed in the Overview of the Governor's Budget, the Facebook impact on state revenues cannot be predicted in advance and will never be known retrospectively with any degree of precision," they wrote. "Yet, given that an IPO clearly would benefit state revenues, we believe it is appropriate for policymakers to incorporate this into their budgetary discussions."

Even if it will be hard to quantify the impact of a Facebook IPO, the bottom line is clear to the LAO: Facebook going public will be great for a state that needs to close a multi-billion dollar budget gap over the next couple of years.

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Alexis C. Madrigal

Alexis Madrigal is the deputy editor of TheAtlantic.com, where he also oversees the Technology Channel. He's the author of Powering the Dream: The History and Promise of Green Technology. More

The New York Observer has called Madrigal "for all intents and purposes, the perfect modern reporter." He co-founded Longshot magazine, a high-speed media experiment that garnered attention from The New York Times, The Wall Street Journal, and the BBC. While at Wired.com, he built Wired Science into one of the most popular blogs in the world. The site was nominated for best magazine blog by the MPA and best science Web site in the 2009 Webby Awards. He also co-founded Haiti ReWired, a groundbreaking community dedicated to the discussion of technology, infrastructure, and the future of Haiti.

He's spoken at Stanford, CalTech, Berkeley, SXSW, E3, and the National Renewable Energy Laboratory, and his writing was anthologized in Best Technology Writing 2010 (Yale University Press).

Madrigal is a visiting scholar at the University of California at Berkeley's Office for the History of Science and Technology. Born in Mexico City, he grew up in the exurbs north of Portland, Oregon, and now lives in Oakland.

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