The biggest challenge ahead for Facebook after the IPO


The Facebook IPO is expected to bring in enormous amounts of money for CEO Mark Zuckerberg and his employees, yet with it will also come more challenges. (Seth Wenig/AP)

“A million dollars isn’t cool. You know what’s cool? A billion dollars.”

So goes the famous line from “The Social Network,” when Napster founder Sean Parker (played by Justin Timberlake) begins to educate a young Mark Zuckerberg about Facebook’s potential. And by that measure, at least, Zuckerberg is about to be very, very cool. The Facebook CEO’s stake in the company is expected to be worth some $20.2 billion on paper, according to estimates by the Wall Street Journal, if the stock’s IPO value ends up at the high end of the expected range. That’s not just Internet start-up rich. That’s George Soros rich.

But Zuckerberg won’t be the only Facebook employee who walks away with a fortune when the company goes public, which is expected to happen Friday. Yes, there are the other executives, like Sheryl Sandberg, his handpicked No. 2, who’s expected to become a billionaire herself. But there are also the 1,000-odd paper millionaires the IPO is expected to mint, a fair number of whom are employees at Facebook who will head to the office next week with a very different outlook on life. Suddenly, work looks a lot less necessary.

So how will Zuckerberg manage them? The Wall Street Journal has a great roundup of ideas for the 28-year-old founder. He’ll need to feed these new millionaires’ entrepreneurial mindsets, giving them time and autonomy to work on their own projects. He’ll have to become expert at stroking egos while not setting up cultures that give the lottery winners on staff too much sway. And he’ll need to keep people from checking the stock price, oh, every 10 minutes, and be willing to say goodbye quickly to those who don’t want to stay.

But none of that speaks to what I’d imagine to be one of the company’s biggest challenges. Over the next few years, Facebook will likely be growing its staff exponentially, leaving Zuckerberg to lead both the old-timers and an increasingly larger number of employees who come on post-IPO. This is bound to result in culture clashes between those who remember what the company was like before it got more “corporate” and the newbies who either envy earlier employees’ riches or come in with their own ideas about what a bigger and now public Facebook really needs.

Facebook has gotten a taste of this already. In Fortune’s March cover story, “Inside Facebook,” made available online to the public Wednesday, writers Miguel Helft and Jessi Hempel describe a culture at Facebook that already operates as “two symbiotic halves. One, Zuckerberg's world, is a meritocratic, coder-led organization that develops the Facebook site; the other, which is charged with making money out of it, is subordinate. It is more hierarchical and corporate and is the domain of [Sandberg].” Sandberg’s hires are known as “FOSS,” Helft and Hempel report, or Friends of Sheryl Sandberg, and her side of the business is known as being disciplined compared to the more chaotic “hacker” side.

That existing divide could help Zuckerberg and Sandberg as they navigate the cultural hiccups they are sure to face as the company grows, no matter how many bootcamps or hackathons they may have in place to try to keep the startup culture alive. They’re going to lose some millionaires who want to start their own companies or spend a few years traveling the world. Keeping those folks around won’t be their biggest challenge. That will be finding common ground between those who’ve been there from the start and those who join long after the company has outgrown its startup size. A company like Facebook needs to retain its entrepreneurial roots and not lose its startup cred. But it also has to evolve and change in ways that only its newcomers can teach it to do.

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Jena McGregor writes a daily column analyzing leadership in the news for the Washington Post’s On Leadership section.

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