It's mostly in the first section of the linked article. In brief, business insiders (Zuckerberg et al) get paid the IPO price for their shares. Any increase from that price accrues to whoever bought first.
In recent history, that was investment banker insiders, not business insiders (ignoring for a moment the retained holdings of the business insiders). That windfall is practically the definition of positional rent since it exists only because the I-bankers are the conduits between private companies and the public market. Remember that the I-bankers were also paid a large fee by Facebook to facilitate the IPO. And any first-day-IPO profits are practically risk free to the I-bank insiders (especially before the Facebook IPO, when every offering was expected to jump a bit in price).
In short, I think Zuckerberg analyzed the situation and decided to set the price to maximize the proportion of the cash created by the IPO that ended up in the hands of business insiders rather than I-bank insiders.
It's possible that business insiders like Zuckerberg care about the share price. But they are independently wealthy regardless of the shares. And this close to the IPO, securities laws make the remaining insider holdings somewhat illiquid. And business insiders keep shares to retain control - wealth maximization is important, but not an immediate focus.
One could spin a story about how opening day performance of an IPO is good for the company - but I'm not persuaded. And even if that were true, does it justify what is effectively transferring wealth from business insiders to I-bank insiders?
Ok, now I see what you're saying. However, it seems to me that every pre-IPO shareholder in every company has an incentive, from this argument, to push for a higher IPO price, while the bankers have an incentive to hold the price down. So what made Facebook unusual?
That aside, your point remains good for showing that my speculation is probably off, even though it doesn't in itself explain Facebook's trajectory.
Facebook IPO'd at a price of 38 dollars a share, which apparently gave it a price-to-earnings ratio in the range of 100 - extremely, fantastically high. The price dropped pretty rapidly and is currently somewhere around 20 dollars; which still, presumably, gives it a very high P/E ratio somewhere in the forties. Now, suppose it had IPO'd at a more historically-reasonable P/E of, say, 20 - still high, but not stratospheric. That would put the initial share price somewhere around 10 or 12 dollars. Is there any strong reason to believe that the price would then have *risen* to where it is now? It is not obvious to me that the current price is supported by anything but the historical price - in other words, it's trading around 20 because it has recently traded around 25.
My point: I can't help but wonder if someone connected to the IPO had read Kahneman on anchoring. Somebody, clearly, was buying the stock at 33, just as someone is still buying at 20; I wonder if the chain of thought had that apparently-arbitrary number "38" in it somewhere, making 33 look cheap - fundamentals be damned! And if this happened, who benefited, and what ought we to conclude about the efficiency of markets?