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Zuckerberg Made Instagram Deal Alone

samzenpus posted more than 2 years ago | from the going-solo dept.

Facebook 307

benfrog writes "According to the Wall Street Journal, Facebook's Board of Directors was all but out of the picture when Mark Zuckerberg struck the $1 billion deal to purchase Instagram, the yet-profitless photo-sharing service. From the article: 'It was a remarkably speedy three-day path to a deal for Facebook—a young company taking pains to portray itself as blue-chip ahead of its initial public offering of stock in a few weeks that could value it at up to $100 billion. Companies generally prefer to bring in ranks of lawyers and bankers to scrutinize a deal before proceeding, a process that can eat up days or weeks. Mr. Zuckerberg ditched all that. By the time Facebook's board was brought in, the deal was all but done. The board, according to one person familiar with the matter, 'Was told, not consulted.'"

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and this is how... (5, Insightful)

mozumder (178398) | more than 2 years ago | (#39729011)

bubbles begin: when non-financiers with access to lots of money decide to make financial decisions.

Re:and this is how... (2)

mozumder (178398) | more than 2 years ago | (#39729033)

btw the same thing happened in the 90's, when every person figured out how to gamble using their own money in the stock market, through things ilke ETrade and so on.

Re:and this is how... (5, Interesting)

TWX (665546) | more than 2 years ago | (#39729223)

I don't see how your two posts are the same thing.

Market bubbles happen when something takes on an unreasonable value and continues to grow, people see that it grows and jump on, causing further growth, until there aren't enough new entrants to sustain the expected and required growth. Sometimes the subject of the transaction is something of actual value (property, raw materials), other times it's something of only representative value (Flowers [wikipedia.org] , dotcom companies). A few investors can help the bubble grow, but they certainly aren't the cause. If anyone can be blamed, it's those who sensationalize and provide positive news coverage to bubbles, causing more people to join who might not have done so otherwise.

I saw signs of the housing bubble in 2002 when houses that I felt weren't worthy started crossing the $150,000 mark in this market. When we got married in 2007 we chose not to buy another house, thank goodness. We instead did so in 2010-2011 after the market crashed and got a short-sale for about half of what was owed on it. Our only real lament is not selling the old house when prices seemed ridiculous and renting for a couple of years. We could have tripled our square footage and had no loan if we had done so.

As for the dotcom bubble, that happened because a lot of people who didn't understand technology thought that those who claimed to had something of value, and thousands of companies that had no real product got money poured at them by greedy people who expected to be the next Bill Gates. Fast forward to now, and Zuckerberg is already a rich man, and his company is strong at the moment, so his acquisition isn't really the same thing.

Re:and this is how... (4, Insightful)

jhoegl (638955) | more than 2 years ago | (#39729285)

Although you are correct and the OPs post is pretty dumb, we are in another tech bubble.
It started when the "cloud" stuff started happening.
So... just be careful.

Re:and this is how... (5, Insightful)

TWX (665546) | more than 2 years ago | (#39729447)

I don't think that the Cloud stuff is a bubble so much as it's a fad way of renaming existing technologies under one umbrella label.

You also have something different in Cloud, in that businesses actually have a product if they're offering Cloud services, whereas dotcom companies generally did not.

Re:and this is how... (2)

skuzzlebutt (177224) | more than 2 years ago | (#39729673)

...cloud bubble? WTF is next, a cloud bubble rainbow?

Re:and this is how... (0)

CavemanKiwi (559158) | more than 2 years ago | (#39729343)

Assuming you are in the US. Why would you want no loan??? I mean as long as the debt is easy to service. I have no idea why you would put more into a house then 20%. Given that interest rates are less than 4% now for a 30 year fixed loan. You should be able to invest the money and receive an average return higher then 4% over a 30year period.

Re:and this is how... (0)

Anonymous Coward | more than 2 years ago | (#39729387)

You should be able to invest the money and receive an average return higher then 4% over a 30year period.

Where?

Re:and this is how... (1)

Anonymous Coward | more than 2 years ago | (#39729653)

The craps table, apparently.

I've got a widely diversified portfolio that i've been building up since getting a job in 2006. I currently have about $50k spread across capital building funds, vanguard US index funds, european/BRIC investment funds, all of which are "buy and hold" investments, and according to my records, my holdings are worth $21 more than the money put into it.

Re:and this is how... (4, Interesting)

TWX (665546) | more than 2 years ago | (#39729425)

Call it peace of mind.

Not having a loan also means having the option of having more disposable income when raising children, or being able to have a work arrangement more compatible with personally raising kids. It also means that if one is absolutely fed up of one's job, one has the choice of leaving when one doesn't have to worry about where to live.

Our current loan is financed at 3.75%. We're well aware of the benefits of having a very inexpensive loan. But, even if we had the cash to invest or to pay a chunk of the loan off with, we'd seek to "recast" the mortgage to have both the lion's share paid and to have ridiculously low monthly payments, instead of investing, because owning a home is a sure thing, while investing certainly is not. If anything, we could buy third property and rent that property out too, like we did our old home, and make even more money. But, we're not worried about that, and since we're not terribly greedy people, we're not looking for every possible avenue to make money.

Re:and this is how... (2)

lexman098 (1983842) | more than 2 years ago | (#39729711)

Maybe I can understand the peace of mind (fixed rate mortgage), but if the market truly crashes on a 30 year scale then you and I and your kids are all kind of fucked anyway (it won't happen).

I'm not sure why investing instead of paying your low interest debt gives you more disposable income or work/housing freedom. If anything I would think it's the opposite.

As far as the house being a "sure thing" (assuming you mean it's tangible and insured), that isn't worth as much when you still have to eat etc. You need an income, and in tough times investment principle is probably better to take from than a refinancing (good bye low, fixed interest rate).

Lastly and most importantly, you don't have to be greedy to do what's financially efficient. You can call yourself greedy when you're screwing over your tenants to afford another property.

Re:and this is how... (3, Insightful)

fredprado (2569351) | more than 2 years ago | (#39729441)

The problem most people overlook is that you can't make plans for the next 30 years based on the current scenario. A lot of thing scan happen in such a large time span.

Re:and this is how... (4, Insightful)

Guppy06 (410832) | more than 2 years ago | (#39729381)

and his company is strong at the moment

So far as we know. Hell, if the company's own board is in the dark about what's happening...

Re:and this is how... (0)

Anonymous Coward | more than 2 years ago | (#39729043)

This is how Facebook is going to self destruct.

Re:and this is how... (5, Insightful)

Anonymous Coward | more than 2 years ago | (#39729143)

Ya, good thing it wasn't experienced financiers making financial decisions regarding mortgage derivatives that caused a huge housing bubble and subsequent destruction of the economy a few years ago.

Re:and this is how... (-1, Troll)

ThorGod (456163) | more than 2 years ago | (#39729313)

Ya, good thing it wasn't experienced financiers making financial decisions regarding mortgage derivatives that caused a huge housing bubble and subsequent destruction of the economy a few years ago.

It wasn't, it was "financial engineers" or "quants" (people with engineering/science backgrounds that were crossed over to finance positions) that created/engineered mortgaged derivatives that caused a huge housing bubble and so on and so forth XD

Re:and this is how... (5, Insightful)

Nimey (114278) | more than 2 years ago | (#39729769)

Horseshit. The quants may have made it possible, but it was the beancounters higher up who made the decisions.

Re:and this is how... (1)

jo42 (227475) | more than 2 years ago | (#39729815)

:%s/beancounters/greedy fucktards/g

Re:and this is how... (4, Insightful)

StikyPad (445176) | more than 2 years ago | (#39729803)

Ah yes, blame the nerds. That's how it goes, right? Hackers steal your money and government secrets, nerds will shoot up your school, and they smell all funny to boot. Except it's *criminals* who will do those things, not hackers and nerds. When someone gets arrested for robbing a bank, you don't say "A construction worker held up a bank." It's no different here, and labeling them just feeds a stereotype.

And while derivatives may have been invented by quantitative analysts (quants), they're not inherently risky -- they're just a vehicle. It's the type and diversity of securities packaged in the derivatives that determines the risk. The bankers knew full well what was getting packaged and why. The quants just gave them the "how." I'm not saying the soldiers aren't responsible for the consequences of following orders, but there's plenty of blame to go around, and ultimately those in command should be (or have been) held most responsible, since they are. That is, allegedly, why they get paid the big bucks.

Re:and this is how... (1)

trout007 (975317) | more than 2 years ago | (#39729327)

Not really. It's hard to have a huge bubble without fiat currency. It can be done but they are usually self correcting. But if you have the ability to borrow money into existence you can create a HUGE bubble.

Re:and this is how... (1)

geekoid (135745) | more than 2 years ago | (#39729411)

No, it isn't hard, and they are necessarily self correcting.
History is full of examples.

Re:and this is how... (0)

Anonymous Coward | more than 2 years ago | (#39729515)

If a bubble doesn't 'self-correct' it wasn't a bubble in the first place, now, was it.

I think what you meant to say is, it's impossible to have hyper-inflation without a fiat currency. Because that is a true statement.

Re:and this is how... (1)

TWX (665546) | more than 2 years ago | (#39729615)

Hey! Leave the Italians out of this!!!

Re:and this is how... (0)

Anonymous Coward | more than 2 years ago | (#39729511)

bubbles begin: when non-financiers with access to lots of money decide to make financial decisions.

I agree, but only on condition that you include those financiers. You do remember what has happened within the past 10 years, right?

Re:and this is how... (1)

busyqth (2566075) | more than 2 years ago | (#39729563)

I don't see why anyone is surprised by this.
It's easy throw caution to the wind and blow a billion dollars when you're spending Paul Ceglia's money.

Re:and this is how... (1)

Anonymous Coward | more than 2 years ago | (#39729651)

I think everyone is missing the point: Zuckerberg is as close as it gets to printing money.

Mull that over in your mind. To Zuckerberg, money is a resource which is in practically unlimited supply. All he cares about is what it takes to get what he wants. He's not overly conscious about whether he "overpaid". All that matters is that he gets what he wants.

Re:and this is how... (1)

sonicmerlin (1505111) | more than 2 years ago | (#39729693)

Do you even need to be a corrupt, Wall Street "financier" to realize a billion dollars for cruddy instagram was too much?

Re:and this is how... (2)

ObsessiveMathsFreak (773371) | more than 2 years ago | (#39729833)

Eh, no. Bubbles being when financiers get access to lots of money.

The troubles of our present day have everything to do with the decisions of financiers and bankers, and almost nothing to do with anyone else. Zuckerberg might have a lot of money, but his ability to cause a bubble in anything pales in comparision to that of even a small bank or hedge fund.

Was told, not consulted. (5, Funny)

HermDog (24570) | more than 2 years ago | (#39729013)

Pretty much how we all got Timeline.

Re:Was told, not consulted. (-1)

lattyware (934246) | more than 2 years ago | (#39729035)

What's wrong with timeline? I actually think it's a really good idea, works well.

Re:Was told, not consulted. (1)

Anonymous Coward | more than 2 years ago | (#39729087)

Timeline isn't bad. What's wrong with it is that you read down or you read side to side. On time line you need to read down. Then skip over a giant line and read down again. WTF? If they fixed the UI I would move over to it instantly but it's fucked and it's sad Steven Jobs can't call him up telling to fix it.

Re:Was told, not consulted. (2)

Dahamma (304068) | more than 2 years ago | (#39729345)

I'd say that makes not bad, but horrible. An intriguing concept ruined by a just a plain awful UI design decision. The pure disregard for usability is mindboggling...

Re:Was told, not consulted. (5, Insightful)

gstrickler (920733) | more than 2 years ago | (#39729365)

It's not a bad idea, but it's a terrible implementation. It should be a textbook example of what not to do in the field of information presentation. It puts form over function, makes it difficult to read, hard to find info, and makes terrible use of screen space.

Aside from that, it's just fine.

Re:Was told, not consulted. (1)

bsane (148894) | more than 2 years ago | (#39729713)

All of that was true of the the original facebook ui... I haven't seen timeline, but if its worse than that the mind boggles.

Re:Was told, not consulted. (3, Informative)

rhook (943951) | more than 2 years ago | (#39729275)

Timeline has not been forced on anyone yet that I know of. You have to click the "Get Timeline Now" button to enable it.

Re:Was told, not consulted. (5, Funny)

drpimp (900837) | more than 2 years ago | (#39729323)

Dude this is /. we all know you only have like 4 friends ... not really a good sample size.

Re:Was told, not consulted. (3, Informative)

gstrickler (920733) | more than 2 years ago | (#39729347)

Or click on any one of dozens of apps that automatically enable it (e.g. most/all of the "social reader" apps from sites like the Washington Post, HuffPo, etc.)

Re:Was told, not consulted. (3, Insightful)

Nimey (114278) | more than 2 years ago | (#39729779)

If you let random apps run on your Facebook account you get what you deserve.

Ok (-1)

Anonymous Coward | more than 2 years ago | (#39729015)

Ok

I'm confused (5, Funny)

sir_eccles (1235902) | more than 2 years ago | (#39729063)

Why did it take 3 days for the other guys to say yes to $1bn?

Re:I'm confused (5, Funny)

jjohnson (62583) | more than 2 years ago | (#39729083)

Because the minute someone offers you $1b, you think you're worth 1.1.

Re:I'm confused (5, Insightful)

icebraining (1313345) | more than 2 years ago | (#39729173)

Actually,

Negotiating mostly on his own, Mr. Zuckerberg had fielded Mr. Systrom's opening number, $2 billion

Two billion dollars for a photo sharing social network with no business model /facepalm.

Re:I'm confused (2)

TWX (665546) | more than 2 years ago | (#39729247)

For all we know, in social networking, this could really be the Killer App [wikipedia.org] . We won't know until we see how it's used. I don't personally think that it is, but I'm also not a user of modern social networking either.

Re:I'm confused (4, Insightful)

Jafafa Hots (580169) | more than 2 years ago | (#39729437)

Couldn't Facebook "roll their own" photo-sharing service for less than a billion dollars?

How in the hell did obvious ideas backed by a few weeks of coding become worth billions?

Re:I'm confused (4, Insightful)

TWX (665546) | more than 2 years ago | (#39729495)

MS-DOS was worth billions of dollars, and it was a hackjob because the creator of CP/M wouldn't give IBM the time of day and they needed something NOW.

Google was a research project that proved phenomenonally successful yet started out simply.

Apple was from a few hardware hackers building illegal devices in a garage in the suburbs.

You don't know where the next killer app will come from. In this case, if Instagram was the first company to do this truly correctly in the technical sense, and if Facebook wanted this technology NOW, then we're back to the same scenario as a bunch of hackers in New Mexico ready to fulfill the needs of a giant company from Armonk.

Re:I'm confused (5, Insightful)

Anonymous Coward | more than 2 years ago | (#39729687)

This acquisition wasn't about the technology, it was about a desirable user population interacting on something that was not Facebook.

If you're looking for a historical analogy, Yahoo buying GeoCities for billions in stock is probably a good fit.

Re:I'm confused (0)

Anonymous Coward | more than 2 years ago | (#39729569)

This not about building your own -- this is about buying out a competitor.

Re:I'm confused (2)

moozey (2437812) | more than 2 years ago | (#39729629)

It's one thing creating an Instagram clone but it's another thing attracting the ~30 million members to use it. If Facebook created their own Instagram there's every chance it could turn out like Google+. Why compete with something when you can just consume it?

Re:I'm confused (1)

cob666 (656740) | more than 2 years ago | (#39729669)

I would be surprised if most of those ~30 million users Instagram claims to have aren't already using Facebook to share their photos.

Re:I'm confused (1)

Surt (22457) | more than 2 years ago | (#39729597)

It could be the killer app, but the real question would revolve around whether or not Facebook could build a superior competitor and win the market for less than a billion dollars. I suspect they could have.

Re:I'm confused (3, Funny)

canajin56 (660655) | more than 2 years ago | (#39729251)

Seems like they had a $1 billion business model! ;)

Re:I'm confused (3, Funny)

larry bagina (561269) | more than 2 years ago | (#39729261)

They had a business model: sell out for $1 billion.

Re:I'm confused (3, Informative)

euxneks (516538) | more than 2 years ago | (#39729337)

Two billion dollars for a photo sharing social network with no business model /facepalm.

It's not the tech he's buying.

Re:I'm confused (0)

Anonymous Coward | more than 2 years ago | (#39729805)

Note the company was valued at $500M. Maybe he overpaid but also maybe he wasn't buying a 100K garbage idea.
http://finance.fortune.cnn.com/2012/04/09/did-facebook-panic/

Re:I'm confused (2)

Daniel_is_Legnd (1447519) | more than 2 years ago | (#39729095)

My guess is they had their lawyers check everything to make sure they weren't getting shafted.

Re:I'm confused (1)

rhook (943951) | more than 2 years ago | (#39729301)

$1,000,000,000 for a company that has yet to turn a profit cannot be considered "shafted", unless you're the idiot who buys it.

Re:I'm confused (0)

Anonymous Coward | more than 2 years ago | (#39729509)

It can if it's couched in ridiculous terms that makes the one billion dollar deal effectively transfer substantially less than one billion dollars.

Re:I'm confused (2)

TWX (665546) | more than 2 years ago | (#39729119)

If I were offered a BILLION dollars for something that I'd created, the first thing I'd do would be to hire a lawyer or firm capable of verifying the functionality of the agreement and letting them give any points as to things that could cheat me out of my money. That doesn't happen in a few minutes. "Yes" is a foregone conclusion for all but such a small number of otherwise reasonable transactions that it's essentially a certainty.

Re:I'm confused (1)

icebraining (1313345) | more than 2 years ago | (#39729201)

No, TFA says the guy asked for two(!) billion.

Re:I'm confused (0)

Anonymous Coward | more than 2 years ago | (#39729171)

Because it was half of what Instagram wanted.

Read that in WSJ this morning -- no link because I read papers oldschool style

Re:I'm confused (1)

bluemonq (812827) | more than 2 years ago | (#39729203)

Because they originally wanted $2 billion. Seriously.

Re:I'm confused (1)

Local ID10T (790134) | more than 2 years ago | (#39729647)

He waited for the check to clear the bank.

Not buying into Facebook IPO (5, Insightful)

Anonymous Coward | more than 2 years ago | (#39729071)

Mr. Z seems to be a bit immature. Maybe this was an amazingly clever purchase, but it strikes me as a childish exercise in spending. Assuming he retains control of FB after the IPO I don't expect that the company will fare well or spend cash well. IMHO..

Re:Not buying into Facebook IPO (1)

TWX (665546) | more than 2 years ago | (#39729091)

Only time will tell us the answer to that though, and possibly not even then. This will pivot on what Facebook does with its new company, and what happens to Facebook writ large in the marketplace and within the rest of the company.

Re:Not buying into Facebook IPO (1)

gl4ss (559668) | more than 2 years ago | (#39729319)

considering they had a billion dollars to lay on it _before_ ipo...

anyways, is it all cash or partially shares in fb?

Re:Not buying into Facebook IPO (1)

moozey (2437812) | more than 2 years ago | (#39729671)

Cash and shares. I'm pretty sure the split has been kept private though.

Re:Not buying into Facebook IPO (1)

Guppy06 (410832) | more than 2 years ago | (#39729679)

The article makes it sound like the purchase was entirely in shares of Facebook.

Re:Not buying into Facebook IPO (4, Insightful)

chrb (1083577) | more than 2 years ago | (#39729385)

Business leaders think that Zuckerberg is some kind of genius tech visionary because of the success of Facebook. That's why he gets invited to have dinner with the President, and to talk at the World Economic Forum...

There is another hypothesis: he got lucky, he happened to be in the right place, at the right time, doing the right things.

Time will tell...

Re:Not buying into Facebook IPO (1)

Anonymous Coward | more than 2 years ago | (#39729445)

No, history already shows that. And by lucky I assume you mean ripped off the tech; which he did.

Re:Not buying into Facebook IPO (1)

thammoud (193905) | more than 2 years ago | (#39729389)

While I agree with you 100%, I dont think the money experts, take your pick (Banks, Hedge Funds), will be any better judge of value.

Re:Not buying into Facebook IPO (1)

SethJohnson (112166) | more than 2 years ago | (#39729609)

I'm not disagreeing with you about whether this was immature. It very well could have been.

I'd like to put the acquisition into context, though. In 1999 the Yahoo board of directors voted to buy an unproven sports video streaming company, "Broadcast.com", for $5 billion. They didn't have a large base of users. All they had was contracts with the different athletic leagues. That asset completely dissolved in the following years and doesn't exist in any way right now. Check: http://en.wikipedia.org/wiki/Mark_Cuban [wikipedia.org]

Read the card... (1)

TwoBeans (618082) | more than 2 years ago | (#39729073)

CEO, bitch.

Re:Read the card... (4, Insightful)

readandburn (825014) | more than 2 years ago | (#39729161)

CEO and Majority Shareholder, bitch.

Fixed that for you.

Re:Read the card... (1)

optimism (2183618) | more than 2 years ago | (#39729473)

Majority Voteholder, bitch

Fixed that for you.

Zuck doesn't hold a majority of shares. But he holds class B shares, so he ends up having majority voting rights. IIRC, 57% of the vote. The CEO part is of course irrelevant, in terms of who controls the overall direction of the company.

Re:Read the card... (2)

Anne_Nonymous (313852) | more than 2 years ago | (#39729813)

Not to go all Grammar Nazi on you, but I'm pretty sure you capitalize "Bitch", if it's a title on a business card.

I want in! (1)

NetNinja (469346) | more than 2 years ago | (#39729077)

I have 10 grand to spare! can i get in on the stock before opening day?

Re:I want in! (1)

Surt (22457) | more than 2 years ago | (#39729643)

Probably not at this point. They've shut down trading on sharespost, so it's much harder to make a deal now. Should have gotten in last month!

Personal Deal (2)

SolitaryMan (538416) | more than 2 years ago | (#39729099)

I had the feeling that there is something personal about this deal from day one. This only reinforces my suspicion.

CEO 2.0 (0)

Anonymous Coward | more than 2 years ago | (#39729117)

Any more proff the Zukerber is just a douche clueless hipster that happened to "create" facebook?

Re:CEO 2.0 (2, Insightful)

TWX (665546) | more than 2 years ago | (#39729273)

No different that Bill Gates, that college dropout that was in the right place at the right time, had an ostensible competitor that didn't fit the system correctly, and managed to provide something close enough to what was wanted and needed to cement his place in the market.

Re:CEO 2.0 (2, Insightful)

Anonymous Coward | more than 2 years ago | (#39729743)

Gates & Allen were the first to offer a high level language for microcomputers.

Zuck was the 423rd person to create a social network website, he was just smart/lucky enough to target Harvard students as his initial user group.

Re:CEO 2.0 (1)

optimism (2183618) | more than 2 years ago | (#39729501)

Douche, perhaps.
Clueless, unlikely.
Hipster, absolutely not.

Re:CEO 2.0 (1)

moozey (2437812) | more than 2 years ago | (#39729723)

You have no idea what kind of person the term "hipster" refers to, do you?

Profitless? (5, Interesting)

NovaSupreme (996633) | more than 2 years ago | (#39729123)

>> Instagram, the yet-profitless photo-sharing service
Make that revenue-less!

Their whole pitch on making money is presented here in its entirety:
". There will be opportunities for consumers to buy extra add-ons like special filters, etc. "
So, folks, that's it - special filters, etc. Magical words.

Re:Profitless? (1)

DerekLyons (302214) | more than 2 years ago | (#39729423)

In app purchases/microtransactions are a proven model.

SPECIAL FILTERS! (1)

wsanders (114993) | more than 2 years ago | (#39729431)

Where do get me some of this! Can they deliver it to my house via Webvan?

Wait for the next acquisition after the IPO (2)

Kergan (780543) | more than 2 years ago | (#39729165)

Shareholders were told, not consulted, that a year's worth of earnings had been invested in a company with 30M+ users, nearly all Facebook users, and zero revenue...

I suspect that Zuck needs to work on investor relations somewhat...

The really sick thing about where you are wrong? (1)

way2trivial (601132) | more than 2 years ago | (#39729459)

it was 98 days worth of revenue, based on 2011 income.

not even 4 months worth....

http://en.wikipedia.org/wiki/Facebook [wikipedia.org]

Re:The really sick thing about where you are wrong (1)

Kergan (780543) | more than 2 years ago | (#39729551)

Sorry for my poor English. I thought that, in the US anyway, earnings = profits != revenue.

But I might be wrong, obviously, being a non-US native...

Might also be wrong about their making $1bn profits last year, too... But I more or less recall reading that figure at some point.

Re:Wait for the next acquisition after the IPO (1)

optimism (2183618) | more than 2 years ago | (#39729545)

He has majority voting rights over the company, plus he's working "in the trenches" as CEO, plus he already has more money than he can spend.

So no, he doesn't NEED to work on investor relations at all. Unless he wants to add another zero to his already astronomical net worth.

At this point in his life, I'm guessing he doesn't care so much about that next zero. Which makes Facebook a bad stock bet imho.

Re:Wait for the next acquisition after the IPO (1)

Surt (22457) | more than 2 years ago | (#39729659)

Why, he has majority control. He can shaft the investors all he wants and there is nothing they can do.

He only bought instagram to troll (3, Funny)

Cito (1725214) | more than 2 years ago | (#39729205)

Since the Winklevoss twins were interested in purchasing it first. Zuckerberg swooped in and bought it solo with the quickness before the Winklevoss' knew what hit them...

It's all setup for The Social Network Part 2 :P

Easy to understand why (0)

Anonymous Coward | more than 2 years ago | (#39729233)

It's easy to understand why he pushed it through on such short notice. Zuckerberg is all against going public because he will lose much of the control. He is going to use it while he still has it, plus now he need not worry about the approval of his stockholders. Had the company been public and the stockholders not been happy with the purchase, you would see the stock of Facebook drop like a rock.

surprisedface.jpg (0)

Anonymous Coward | more than 2 years ago | (#39729255)

What, they thought being the board of directors made them different from the peons?

Right..... (0)

Anonymous Coward | more than 2 years ago | (#39729355)

Um srsly, no one sees the writing on the wall? This was a front for something else, they probably had dirt on zuckerburg.

And the cost to replace instagram is what? (1)

rs79 (71822) | more than 2 years ago | (#39729373)

100K ?

Some asshole if probably working on a free version right now.

Standing in awe (5, Funny)

caffemacchiavelli (2583717) | more than 2 years ago | (#39729399)

While I'm still unsure how they got their investors to accept a $500M valuation (Series B, was it?), going into a meeting thinking "Yeah, $2B for a popular photo sharing app platform sounds about right" must take some cojones. I probably couldn't sell Instagram for $200M, I wouldn't even know where to start.
"So, we have this platform and our users are totally committed to the experience and not just using it because it's hip...and we all know that social media startups tend to stay popular and don't crash after a year or two...and crap, we can totally monetize that thing, like print photos on mugs and stuff...that's like an instant $80M/year right there, minus the cost of the mugs, of course. So, whaddaya say, two billion?"

Zuckerberg won't like it when Facebook is Public (3, Interesting)

rahvin112 (446269) | more than 2 years ago | (#39729549)

Once Facebook goes public, Zuckerberg is going to be in for a RUDE awakening. He won't be able to treat it like his little piggybank, he will have to consult the board (his bosses after it goes public) for anything he does and the board can fire him.

The vast majority of tech companies that have gone public in the last 15 years have ended up firing the founding CEO after a period of mismanagement shortly after the companies go Public. The exceptions to this rule are rare and I doubt Zuckerberg is going to be one of them. This is the type of stuff they do and after the company is public and the founders ownership is GREATLY diluted they end up getting fired by the board of directors. Usually it's from not seeking maximum shareholder value, but in other cases it's for outright in ability to grow the company.

Personally, I don't think Zuckerberg is going to survive more than 5 years as CEO of the public Facebook. But the VC's and investment banks will have gotten their pound of flesh and moved on.

$100bn (1)

robwgibbons (1455507) | more than 2 years ago | (#39729765)

Where the hell did they get a $100bn valuable? I call BS.

Re:$100bn (1)

robwgibbons (1455507) | more than 2 years ago | (#39729799)

*Valuation. I fail to digest how an IPO valuation at $100bn could even be CONCEIVABLE
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