AUDIE CORNISH, HOST:
From NPR News, this is ALL THINGS CONSIDERED. I'm Audie Cornish.
ROBERT SIEGEL, HOST:
And I'm Robert Siegel. Since going public last Friday, Facebook has taken a beating on Wall Street. Yesterday, the company's stock fell 11 percent and today it plunged again.
As NPR's Steve Henn reports, Facebook's IPO is now one of the worst performing IPOs of the past five years.
STEVE HENN, BYLINE: From the beginning, trading in Facebook stock was a bit chaotic. When it began last Friday, there was this sudden unprecedented surge in interest. Millions of buy orders flooded in. The volume was so intense, NASDAQ slowed everything down. There was a 30-minute delay before shares could actually being changing hands.
STEPHEN KAY: They wanted to make sure that they got everything right.
HENN: Stephen Kay is managing director of the Knight Group. His company executes stock trades on behalf of brokerages that serve many small investors.
KAY: They wanted to make sure systems were working well, communication.
HENN: NASDAQ wanted to get that right, but it didn't. Many buyers weren't sure if their orders went through until hours after Facebook's stock started falling. Lots of little investors lost money. It was such a mess, Mary Schapiro, the head of the Securities and Exchange Commission, told reporters on Capitol Hill today her agency is looking into it. In Massachusetts, Securities regulators are issuing subpoenas. And according to the Wall Street Journal, a NASDAQ official said today that if the Exchange knew the extent of the technical problems it was facing, it would've delayed the deal.
This is not what Facebook wanted.
KATHLEEN SMITH: It would be far better to have a lot of happy investors.
HENN: Kathleen Smith is founder of Renaissance Capital.
SMITH: Happy investors talk positively about the company and it's good for the company's business to have a positive shareholder base.
HENN: Right now, Smith says that's not happening.
SMITH: I haven't seen one positive piece of news about Facebook.
HENN: Instead, the public and the media are focusing on the problems, like Facebook's growth, which is slowing. Many investors believe mobile is where future growth could come from, but this is an arena where Facebook's weak. Right now, it doesn't really make any money on mobile advertising.
Even though Facebook's trading down though, there were some winners in this IPO. Darren Caris is CEO of Caris & Company, a securities firm specializing in tech.
DARREN CARIS: Those who had, you know, been buyers at earlier prices and employees and founders really obviously made out extremely well.
HENN: Many of those early investors, like Goldman Sachs and some prominent venture capitalists, decided to sell off billions more in the days leading up to Facebook's IPO and they made a killing.
In a limited sense, Kathleen Smith says Facebook, the company, did OK, too. It raised a lot of money. Now, it needs to prove itself.
SMITH: So, hopefully, this will be a good motivation.
HENN: Smith says, sometimes, having a chip on your shoulder and something to prove is a good thing.
HENN: And she says the challenges facing Facebook today are really the same ones it faced a week ago: It needs to keep growing and find new ways to make money. The difference is, today, Facebook employees have one additional distraction: The company's roller coaster stock.
Steve Henn, NPR News, Silicon Valley.
(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.