Zuckerberg had never been convinced he should take his company public, though regulatory changes made it inevitable. He worried about shareholders who wanted Facebook’s first thought to be its bottom line rather than its product. He also feared a loss of control. To this end, he had created two classes of shares which guaranteed that he would have 57 percent voting control of Facebook with only a 28 percent financial stake. His anxieties were realized almost immediately.
Zuckerberg was used to updating users of his site, but not so practiced at reassuring investors. Before the IPO, he affirmed what he repeated at the moment of the sale: that he did not see himself primarily as a man in charge of a multibillion-dollar business, but rather as a man on a mission to teach the world to poke in perfect harmony. Fundholders are not traditionally seduced by missionaries.
Over the summer Zuckerberg was strangely silent, as if adjusting to his new realities: married life and problems at the office. He had perhaps the first premonitions of what all prodigies discover: that he, too, would have to grow up. In his first call with major investors at the end of July, he pursued a line about the Facebook model that “the best type of advertising is a message from a friend.” This had sounded reasonable enough when he had uttered it to interviewers and journalists over the years, and it seemed to chime with popular psychology about tipping points — but was it really true? If so, where did it leave companies like General Motors, which were spending a small fortune on creating consistent messages about their products that were measurable in terms of sales?
Over the few years since its inception, Facebook had been somewhat cavalier about its revenue strategies, making the seductive argument that once it had a critical mass of users, money would surely follow. Google had solved the intractable problem of how to monetize its audience by having advertisers bid for keywords, selling sponsored links and charging for each time a user clicked on them. Facebook’s advertising model was always more intangible, based largely on precisely targeted display adverts and the vaunted “engagement” of the user, who typically spends an hour a day on the site. In a widely quoted figure, Google made US$88 from each of its users, Facebook only US$15. Moreover, Google’s model worked potentially equally well on mobile formats as on desktops. Facebook had been slow to see the shift to mobile and that apparent anxiety over releasing user data which angered the likes of Hyms, Goldberg and Garrison suggested they were still troubled by the problem of how to make effective use of display advertising on a screen no bigger than a playing card.
Zuckerberg’s first public appearance was on a technology platform last month — he talked 10 to the dozen for 20 minutes about the new realities of his business. His message had changed somewhat in the months since the YouTube clip. There was a little less emphasis on the incontrovertible value of pursuing an open and connected world and a little more on the prospect of specific plans for generating increased advertising revenue from “monetizing eyeballs.” Zuckerberg admitted the company’s previous strategy for mobile (he pronounced the word to rhyme with “no bull”) had been wrong. However, without too many specifics, he was confident Facebook could eventually make more money per user on mobile phones than on desktops.