Mark Zuckerberg is dog-tired and perhaps a little grumpy. The 24-year-old
founder of Facebook is in London towards the end of a week-long tour of
Europe and has been averaging less than five hours' sleep a night.
Being the “face” of Facebook is not his favourite part of the job and he has
had some tricky questions to fend off from the European media about Facebook
and its future development, particularly the niggling doubt over exactly how
and when the social networking site is going to make money.
The technology blogs in Silicon Valley have been giving Facebook a hard time
recently. The phenomenal popularity of the site — which is not even five
years old — is no longer enough for some analysts.
Mr Zuckerberg and three others launched the site from their Harvard dorm room
in early 2004. By the end of the year it already had one million active
users — now it has exploded past the 110 million mark and shows no sign of
slowing down.
The recent growth spurt has been powered by Facebook-users translating the
site into local languages. The Spanish version has swept Latin American
countries and Chile is about to become the first country in the world where
more than 50 per cent of the online population are active users of the site.
In the UK there are 12.6 million active users — about a third of the online
population — and Mr Zuckerberg is in London to talk to developers who are
creating applications by the thousands for the Facebook site.
This is a key part of the Facebook strategy — not to try to do everything
themselves. The company launched Facebook Platform last year, allowing
developers to build features for other users within the site and make money
from selling them. This resulted in an avalanche of applications — some
annoying, some trivial and some useful — which has helped to make the site a
richer experience.
Mr Zuckerberg says: “We realised there was no way we were going to be able to
build all the different ways that people would want to share. The web is
just expanding so quickly — we found that a good strategy has been to focus
on one or two things that we can do really well.
“For us that's helping people connect with people and things that they care
about. You are better off focusing on those things and helping to build an
eco-system around you for all the other stuff. No one can do everything.”
In May, Facebook went further and allowed third-party websites to take the
basic tools of Facebook and build it into their pages. While this “open
platform” strategy is hardly ground-breaking — Google, Microsoft and Apple
do the same thing — Facebook has used it to improve its appeal to become the
fourth-most-visited website on the planet while retaining a comparatively
small workforce of about 700 employees.
And, unlike those big beasts, Facebook is still independent, still private,
still, in fact, very much Mr Zuckerberg's baby — and that is the way he
wants it to stay while he concentrates on growing the user base.
“People all over the world have friends, family, co-workers they want to stay
connected to and we have found that Facebook is something everyone could
use. We have just hit this big milestone — 100 million active users — and in
a lot of ways that is a really cool thing for us, but in a lot of ways it is
really just the start.”
Some have mistaken his ambition for hubris. Mr Zuckerberg's geeky, aloof style
can be awkward but there is no doubting the drive of a man who happily
admits that the only thing he does outside work is sleep.
What about making money? Turning that huge growth into cash is proving
problematic. By Mr Zuckerberg's own estimates in early 2008 Facebook will
make only about $300 milllion (£173.5million) in revenues this year, mainly
in display advertising on the site in a deal with Microsoft, and will have a
negative cashflow of about $150 million. Yet Mr Zuckerberg says that he is
in no hurry. For the time being, he simply wants enough income to “sustain
ourselves”. This attitude, especially in gloomy economic times with the
prospect of an IPO disappearing over the horizon, has attracted criticism.
Mr Zuckerberg says that Facebook has a strong advertising business and it is
building an international salesforce to improve it further. It is also
experimenting with a new type of advertising product - “engagement ads”
which encourage users to share and comment, raising brand awareness. MTV
recently had a successful trial with a promotion for its video awards on the
site.
Yet the truth is that making money is not Mr Zuckerberg's prime motivation (he
is angrily forceful on this point). He retains his youthful idealism that
Facebook can and should change the way people live for the better by
connecting them to each other. “The goal of the company is to help people to
share more in order to make the world more open and to help promote
understanding between people. The long-term belief is that if we can succeed
in this mission then we also be able to build a pretty good business and
everyone can be financially rewarded.”
In the meantime, in an effort to keep senior staff happy after a flurry of
departures, including Dustin Moskovitz, the co-founder, Facebook is to help
employees to sell their company shares privately, up to a value of $900,000
each. The private stock sales are said to be at a valuation of only $3.75
billion, a huge drop from the $15 billion valuation of a year ago when
Microsoft took a 1.6 per cent stake for $246 million.
For the moment such statistics do not overly concern Facebook's chief
executive. He believes that building the business is the key to success. He
has been pretty good at it so far.
Q&A
If you could change one thing in the financial and commercial environment,
what would it be?
There is so much going wrong in the current financial climate... pass.
Who is or was your mentor?
Donald Graham, chief executive officer and chairman of the board of The
Washington Post. He takes a very long-term view on business. So much of
technology is focused on a really short cycle.
Does money motivate you?
No.
What is the most important event of your working life?
The launch of Facebook in 2004.
What gadget must you have?
A Blackberry and an iPhone.
What does leadership mean to you?
Leadership is basically about creating focus. It is about ensuring we are
focused on the right stuff and getting good people in to help build what we
are trying to do.
How do you relax?
I sleep.
CV
Born: May 14, 1984 in Dobbs Ferry, New York
Education: Attended state schools and then sent to the exclusive
Phillips Exeter Academy, New Hampshire (2000-2002); Studied psychology and
computer science at Harvard University but dropped out.
Career: Launched Facebook with Dustin Moskovitz, Chris Hughes and
Eduardo Saverin from their Harvard dorm room in February 2004. By March, it
has expanded to Stanford, Columbia and Yale. In June 2004 the base of
operations was moved to Palo Alto, California.
Job description: CEO of Facebook, responsible for setting the overall
direction and product strategy for the company. He leads the design of
Facebook's service and development of its core technology and
infrastructure.
Would really like to talk to him, in fact I would really like to talk to anyone at Facebook. While trying to send a Christmas Card via Facebook to people on my friends list I was "disabled" for abuse. Idealism before profit maybe but no good manners.
malcolm Kinnear, ios, Cyclades, Greece
Congrats to a brilliant, hard working and passionate entrepreneur.
Marcus Greenwood, London, UK
"What is the most important event of your working life? The launch of Facebook in 2004. " Really? Not that internship just before he launched Facebook? The one at that company which was developing a social network for students and shares strangely similar code? I thought that 'inspired' him.
anita, london, uk
Pretty amazing acomplishments, especially for a 24 year old. Nice to see a young entrepreneur who is not solely motivated by money.
John D., London, UK