Zuckerberg made the comment amid a media push celebrating Facebook reaching 1 billion users that included an interview with Matt Lauer on the Today Show.Bloomberg Businessweek also got a shot at Zuckerberg and asked him what he has learned about the public markets and institutional investors in the last six months during the Facebook stock debacle. His answer suggested that he has not learned all that much, or at least that he has not changed his general attitude:
“We’re focused on the long term. That hasn’t changed. And sometimes people ask this question, which is like, all right, how is going public going to change the culture of the company? My view is that’s actually a choice. Nothing has to change the culture of the company. That’s a leadership decision we get to make, how we choose to prioritize.”
Zuckerberg has been saying the same thing now for a while. With a complete lock on control of the company because of its dual-class share structure, Zuckerberg, 28, has made it very clear that he is going to focus on Facebook’s products and is in no rush to squeeze out big earnings-growth from his 1 billion users. He repeated this mantra: “The only thing we can really do is focus on making the company worth as much as possible over the long term. I suppose there could be short-term things that we could do, but we’re not going to focus on those; we’re going to focus on the long-term stuff.”
Facebook’s stock investors could use some of those short-term things right about now. Zuckerberg has been a man of his word, but so far that has not worked out for stock investors. Jeff Bezos helped popularize this kind of approach at Amazon, building a phenomenally successful company by relentlessly focusing on the long-term and not directing the company’s energy on hitting quarterly earnings goals. And the tech world is littered with MySpace-like warning signs that show what can happen to companies that aren’t careful about pursuing revenue growth.
But Bezos never had to deal with 1 billion new Amazon shares hitting the market in a two-week span, or losing $40 billion in market value in a few months. He also never seemed so captured by the billionaire venture capitalists in Silicon Valley. Peter Thiel dumped most of the Facebook stock that made him a billionaire the first chance he got, contributing to the summer fiasco. Yet he is still on Facebook’s board. In thevery first answer Zuckerberg gave to Bloomberg Businessweek about hitting 1 billion users, he cited another venture guy who is a Facebook board member, Marc Andreessen, comparing Facebook to McDonald’s.
The point, as Zuckerberg kind of acknowledged last month, is that the stock drop has hurt the company. It makes it harder for Facebook to raise money again to compete with Google (half the money raised in the IPO went to the venture investors) and it makes it harder to retain and attract talented employees. Zuckerberg has built a great company that services 1 billion users and his focus on being around for a long time is understandable. But something does need to change when companies go public and subject themselves to market discipline. That sort of thing used to be celebrated in America—maybe too much so, but sometimes I wonder if Japan could have used a corporate raider or two somewhere along the line. As John Maynard Keynes said: “In the long run, we are all dead.
No comments:
Post a Comment