Money Moguls

Mark Zuckerberg’s life thus far is practically a movie script. Maybe someone will make a movie out of it. Who knows?

Here’s the plot. A brilliant kid masterminds a technological event while attending an Ivy League school…like Harvard…and launches it to hugely enthusiastic reviews. Big wigs stake out his dorm, hungry to make his acquaintance. He drops out of college to nurse his baby and change the world as we know it. Just thirty six months in, what began as a networking site for college students has turned into a go-to resource for 19 million registered users, including government employees and Fortune 500 companies. More than 50% of the registered users visit every day. When a misunderstood new feature brought schrieks of protests from roughly 700,000 users, the media jumped to cover the repercussions. However, Facebook emerged unscathed and stronger than ever. Facebook is now the 6th most-trafficked site in the United States according to ComScore Media Metrix, which tracks Internet activity. ComScore also rates it the top photo sharing site on the Internet, with 6,000,000 images uploaded daily. Facebook is starting to compete with Google and other technology giants as a destination for top young engineering talent in the Silicon Valley.

A senior analyst at eMarketer, Debra Aho Williamson, says Facebook is on track to earn about $100 million this year. This is serious money indeed.

There is some serious controversy about whether Mark Zuckerberg is making good decisions about the Internet Giant he created. TechCrunch, a high tech blog, released documents claimed to be a part of an internal valuation of Facebook by Yahoo. These documents forecasted that Facebook would produce revenues of $969 million, with its 48 million users in the year 2010. It was reported that Yahoo offered $1 billion purchase Facebook. Mark Zuckerberg and his partners turned the offer down. There was an earlier report of a $750 million offer from Viacom. Facebook, ViaCom and Yahoo would not comment on the deal.”It’s all been very interesting,” says Mark Zuckerberg, sitting in a conference room in Facebook’s Palo Alto headquarters. His appearance is every bit the geek. He wears a zippered brown sweatshirt, baggy khakis pants and Adidas sandals. He walked into the room eating a bowl of cereal from a paper bowl with a plastic spoon. He still resides in a rented apartment, with a 2 chairs, a table and a mattress on the floor. Mark walks or rides a bicycle to the office every day.

Mark Zuckerberg’s college kid approach supports the doubts of those who see his decision to retain ownership of Facebook as a lapse in judgment. The 2 major Web 2.0 titans have sold out to major corporations in 2 years. MySpace accepted $580 million to join News Corp. and YouTube agreed on a $1.5 billion offer from Google. You could bet any cleaver entrepreneur would leap at a chance to piggyback on those deals.

Do you think Mark Zuckerberg is being greedy…maybe waiting for a more lucrative offer? If so, will that return to haunt him? If its not, what exactly is Mark Zuckerberg’s plan?

Mark replies, “I’m playing a different kind of game. I’m here to build something for the long term. Anything else is a distraction.”

Mark and his comrades, Dustin Moskovitz the cofounder and VP of engineering is 22 years old, Adam D’Angelo, his roommate at Harvard, and CTO is 23 years old, are at the controls of the company and true believers. Their belief: that the collaboration, openness and sharing of information epitomized by social networking can make the world work more efficiently.

You may think they were naive, except that they’re so intelligent and creative and have succeeded in ways most people never do. Starting as a Mickey Mouse operation run out of sublet apartment in Palo Alto, they now own 2 commercial buildings of cool gray offices. They now employ 200 who take pleasure in their competitive wages, complete benefit packages, 3 catered meals a day, free laundry and dry cleaning. They continue to push out improvements to a technological marvelous web site.

For now, the people who fronted Mark Zuckerberg $12.7 million back in the spring of 2005 and the other venture investors whose money and connections have helped Facebook’s explosive growth classify themselves as content. After all the member base has continued to skyrocket, especially since the news of the Yahoo deal. This has significantly increased Facebook’s value. But what happens when those investors start getting antsy about realizing a return on their investment? Would a sale or more likely an IPO be far behind?

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