An interesting article on how a visionair like Zuckerberg shows restrained and keeps focusing on user value irrespective of a money driven environment and with that rises the stakes again and again.
C.O’ Brien: As incredible as it seems that Facebook has crossed the threshold of 500 million users in just six years, I find myself even more amazed at how the company reached this remarkable milestone.
This struck me recently as I was reading “The Facebook Effect,” the account of the company’s rise by technology reporter David Kirkpatrick. In pulling the various threads of Facebook’s story together, some known and some previously unknown, the book crystallized for me some important lessons from what has become one of the most remarkable business stories ever seen in Silicon Valley.
Facebook has joined the pantheon of the most important valley companies: Google, Apple, Oracle, Hewlett-Packard, Intel and Cisco.
Systems. Though it is far smaller than any of these in terms of revenue, its impact on society arguably rivals any of them.
And in large part that is due to the unshakable vision and leadership of its founder and CEO, Mark Zuckerberg. Sure, he has made any number of missteps along the way, as you would expect from someone who is still only 26. But let’s appreciate the things he’s done right — often bucking the conventional wisdom and the advice of more experienced elders.
First among these was the decision by Zuckerberg to insist that Facebook focus on the user experience first and ignore the business side in the short run. In Kirkpatrick’s book, advertisers of all sorts were approaching Facebook’s sales teams early on,
offering to pay large sums for various ad schemes. But Zuckerberg turned many of them down — to the dismay of his sales team — because they would disrupt the look and feel of the Facebook experience.
Facebook’s apparent lack of a business model has been the butt of some easy jokes (until Twitter came along), but Zuckerberg was smart. The company is fine-tuning its advertising strategy, but in the meantime it has become such an unstoppable force on the Web that it can afford to take its time turning on the revenue spigot.
And the extraordinary treasure trove of personal information we’re volunteering to Facebook is inevitably going to turn into a gusher of advertising revenue that may one day be the envy of Google, which can only guess at who we are and what we want.
Another example of how Zuckerberg’s instincts have served the company well comes from the way the service itself has evolved. Many changes have been met with outrage from users and criticism from the press.
Rather than panic and try to placate critics, Zuckerberg has been able to look past the hue and cry in a way that shows he sometimes understands his users’ behavior better than they do.
The best example of this may have been the controversy over the introduction of the news feed in September 2006. When Facebook first launched, each user had a profile page. But if you wanted to see if someone had made changes or uploaded a new photo, you had to keep going back to that friend’s page to check for new content.
Zuckerberg conceived of the news feed to solve this. Now you would just have one stream of updates on all of your friends’ activity.
When this launched, users went ballistic. They decried the massive privacy invasion (even though no new information was being shared). People even started groups on Facebook to protest the news feed that quickly gained thousands of members.
But Zuckerberg recognized the viral nature of these protest groups was in fact made possible by the news feed they were protesting. And while he made some modest changes to the settings, he resisted pressure to switch it off.
Today, the news feed is an essential part of the Facebook experience and in large measure the reason for the site’s fantastic growth and the large chunks of time many of us spend there.
While Zuckerberg does have a strong sense of where this is all taking us, he does at time get ahead of his users. And he still needs to learn how to better manage the introduction of big changes so that they don’t cause massive user revolts. But even when he deserves criticism, no one can accuse him of being greedy.
Anyone who insists he’s doing any of this for the money is just flat-out wrong. When the site was just 2 years old, Yahoo offered to buy it for $1 billion. The site still had less than 12 million users and was far behind MySpace in the social networking world. Zuckerberg was being offered more than $1 billion for the company at a time when it was far from certain that it would be king of social networks. Zuckerberg, then just 22, still had control of the majority of the company and turned the offer down over the protests of some of his venture capitalists and executives.
Could you have turned down $1 billion when you were 22? When your company was a distant No. 2? No, you couldn’t have. But Zuckerberg did and still resists an IPO that would most likely make him a multibillionaire.
As we look ahead now and wonder if the company can reach 1 billion users, I would be more surprised if it didn’t. No one is going to come along and dislodge Facebook anytime soon. And for that, credit goes to Zuckerberg for the vision he showed in laying a rock-solid foundation on which to build a company poised to serve as the central nervous system of the Web for years to come.
Source: MercuriNews
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