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I can't help but go back to Mark Zuckerberg's letter when Facebook was preparing to IPO: "... we don’t build services to make money; we make money to build bet
by leothekim 8y ago
I can't help but go back to Mark Zuckerberg's letter when Facebook was preparing to IPO:
"... we don’t build services to make money; we make money to build better services.
"And we think this is a good way to build something. These days I think more and more people want to use services from companies that believe in something beyond simply maximizing profits." [1]
I mean, there was no way he was going to drop $22 billion dollars on something and not get a return. But I can't help but notice how the article depicts him as someone who is thinking more strategically, contractually, and businesslike (i.e. profit-driven) than someone who would write something like the quote above. Whatever he was then, he seems to have taken a step away from it and become... a CEO.
[1] https://www.yahoo.com/news/mark-zuckerberg%E2%80%99s-ipo-letter--why-facebook-exists.html https://www.yahoo.com/news/mark-zuckerberg%E2%80%99s-ipo-let...
- ThrustVectoring 8y ago>I mean, there was no way he was going to drop $22 billion dollars on something and not get a return. There's plenty of valid business reasons to spend money on ventures that aren't "net present value of cash flow projections exceed costs". There can be indirect effects like maintaining a moat - buying WhatsApp can be worthwhile simply to ensure that other companies can't use it to compete with Facebook's core business. Or there can be real option considerations. Or it can drive down the price of the complements of your core product.
- leothekim 8y agoDefinitely, great point. For Facebook + WhatsApp, I'd bet that this is a case of Mark having a giant ad revenue hammer, and everything else that's corralling eyeballs is inevitably going to be a nail.