With Facebook now on the market with a $104 billion valuation, how will the brainchild of co-founder Mark Zuckerberg move ahead as a public company?
At 28, Zuckerberg has seen the project he began building with other students in a college dorm room become the subject of an Oscar-nominated film, the focus of frenzied investors and a central part of the daily lives of nearly 1 billion users — 901 million, at last count.
His personal stake in Facebook is now worth around $19.1 billion, making him richer than Google co-founders Larry Page and Sergey Brin, according to Bloomberg’s Billionaires Index. Going public has made him the 29th-richest person in the world.
But going public was never in Zuckerberg’s plans when he started the social network. That’s something he makes immediately clear in his note to potential investors, including in the company’s S-1 filing to go public.
“Facebook was not originally created to be a company,” Zuckerberg wrote. “It was built to accomplish a social mission — to make the world more open and connected.”
That has been a consistent message as Facebook marketed its initial public offering to investors. For Zuckerberg, the social network is about users, about connections, about cool products, not — much to the ire of advertisers — about the bottom line.
Discussion around whether it was appropriate for Zuckerberg to wear a hoodie during the company’s roadshow drew one aspect of the Facebook IPO into sharp focus: Zuckerberg, personally, is the at the center of the debate over how Facebook will manage as a publicly traded company.
Zuckerberg is not naive, but his somewhat idealistic mandate to put user experience first permeates the company. The young co-founder calls it the “hacker way,” which shows up in everything from Facebook’s all-night hackathons — the company had one last night to celebrate the IPO — to Zuckerberg’s surprisingly controversial hoodie.
This culture that’s focused on making cool things is fine for the average user. But it’s a little scary for investors that Facebook’s first priority isn’t making money, particularly as it faces questions over how to maintain and grow its revenue when it hasn’t quite figured out how to monetize its user base.
Zuckerberg hasn’t given any indication those priorities will change. Even when courting investors, he said that he just wants to be able to bankroll the features that he wants to add to the network.
“Simply put: we don’t build services to make money; we make money to build better services,” Zuckerberg wrote in his letter.
Cue the Wall Street tooth-gnashing.
So now, with the added pressure of investor expectation, it falls to Zuckerberg and his 55.8 percent of voting shares to prove that the company can walk the line between making money and pleasing its users. It falls to Zuckerberg to prove that Facebook is prepared for the mobile revolution and can figure out how to turn its mobile growth into new revenue.
And it falls to Zuckerberg to show anyone whose feathers were rumpled at the sight of that hoodie that Facebook can adapt to whatever is thrown into its path — privacy issues, bad publicity, backlash to its design changes — and still come out on top.
(Washington Post Co. Chairman Donald E. Graham is a member of Facebook’s board.)