THURSDAY, MAY 17, 2012: Facebook, the social-networking site that lets some 500 million people trade messages, pictures and videos every day, raised $18.4 billion for its investors when 484.4 million shares were priced at $38 a share late Thursday. The price values the company at $104.1 billion, making Facebook the 40th most valuable company in the world, ahead of Amazon.com (AMZN -2.54%) and Qualcomm (QCOM -3.30%) but just behind PepsiCo (PEP +0.03%). It makes founder and CEO Mark Zuckerberg worth some $19.1 billion on the basis of his Facebook holdings alone -- at just 28. The pricing -- which is what Facebook and selling shareholders will get for their shares -- comes as the U.S. stock slumped in late-day trading. The Dow Jones industrials ($INDU -1.24%) fell 156 points.

The pricing is the last step before the stock can be traded on U.S. financial markets. Trading in Facebook shares will start Friday morning on the Nasdaq system with the ticker FB. What could not be known with certainty late today was where the stock would open, much less where it would close. But look for a lot of volatility. Investor interest in the stock is enormous. Many brokerages marketing shares stopped taking orders on Wednesday. Road shows -- the presentations the company put on around the country to explain the stock to potential investors -- were packed affairs. And as much attention was focused on Mark Zuckerberg's wardrobe as the Palo Alto-based company itself. Zuckerbook appeared at his first event, in New York City, wearing his trademark hoodie.

Facebook's rise is one of those mythical American success stories. Zuckerman founded the company in 2004 while he was a student at Harvard. The name comes from the books colleges give incoming freshmen to help them identify their classmates. The company grossed $382,000 that year. In 2011, revenue hit $3.7 billion, with net income reaching $1 billion, according to the company's prospectus. Its reach in the United States, Canada, Latin America and Europe is enormous. The company estimates 526 million people used the service every day as of March 31.

With success and a ridiculously visible IPO comes scrutiny. When the stock starts to trade on Friday, the debate will become more heated especially if the stock really soars. At $50, John Cassidy of The New Yorker magazine noted Wednesday, that the company would be worth nearly $137 billion. And after that, who knows? Of course, Google (GOOG -0.93%) went public at $85 a share in August 2004 and closed at $100 at the end of its first day of trading. The debate over whether Facebook is worth $38 a share centers around several issues that won't be resolved for some time:

The valuation issue: At $38 a share and $1 billion in profit, Facebook is selling at 100 times trailing earnings. That's pricey. At $628.93, Google's close on Wednesday, the shares were selling at 24 times trailing earnings and 14 times projected earnings. Apple (AAPL -2.92%) is selling at 13 times earnings and 10 times forward earnings.

The growth issue: As Facebook gets older, its revenue growth will necessarily shrink. It's shrinking already. 2011 revenue grew 88% over 2010 to $3.7 billion. In the first quarter of this year, the growth rate dropped to 33%.

The business model quandary: About 85% of Facebook's revenue comes from advertising, and there's a question about whether the advertising works. With the Internet, advertisers think of it roughly in these terms: How many people click on an ad? How many of them actually buy something via the ad?

General Motors (GM -1.37%), in face, said it was going to stop buying ads on Facebook because the auto maker didn't think the results justified the cost. GM has spent $10 million on ads on Facebook. Rival Ford Motor (F -1.48%) said it has generated plenty of leads via its advertising with Facebook.

There are two additional issues that will have to be resolved positively for Facebook's stock to thrive. First, it needs to find a way to generate large gobs of revenue from its mobile traffic. Smart phones are generating roughly half of its traffic, but the advertising is modest at best. Second, Asia is one of the biggest sources of growth. Ask Apple, which now gets 40% of revenue from China. But Facebook has a relatively small presence there and none in China.