Conventional wisdom seems to be saying that Facebook paid too much to
acquire WhatsApp, a mobile texting startup that is enjoying meteoric
success in developing countries. At $19 billion, the price may exceed
the GNP of some of those countries, so I see the point–if you think that
is what should be measured.
But I don’t think Mark Zuckerberg is much of a conventional thinker.
If he were, then Facebook would not have transcended from a dating site
for Ivy League fraternity boys into the world’s largest social network. I
am not his greatest fan, but I do admire Zuckerberg’s ability to choose
routes to strategic goals that no one has considered taking
previously.
I think this is a brilliant–but risky–deal, one that give Facebook a
clear shot of becoming the most successful of all Internet companies in
the 21st century, but I am looking through an unconventional prism. a social measurement expert has taught me, companies become what they measure.
CTO at
Stremor.com in Scottsdale and I are Facebook friends. We have talked
there often, but have never met. I usually like his ideas, but last week
we banged heads over this acquisition. He hates the deal. He is looking
at numbers which don’t add up; I am looking at the story, which shows
promise and vision.
Where I see inspiration, Wirtz sees a bone-headed play, confirmed by
the fact that Facebook stock immediately ratcheted down upon its
announcement. I rarely see wisdom in Wall Street’s knee-jerking,
wallet-slapping response to unconventional moves. The Street has lost
its patience with long moves. It is more like offtrack betting than
investing these days.
Mark Zuckerberg showed the world what he thinks of Wall Street by
showing up in a hoody when he visited the folks in Gucci suits and
Ferragamo shoes before Facebook’s IPO. The stock suffered from that
play but not for very long. I think that will be the case this time
around as well.
Wall Street sees Zuckerberg as quixotic. I see him as playing a much
longer goal than making the stock bumped after the market closes one day
and before it opens the next. It seems to me he has been focused in the
same direction for the entire time that his company has been under
public scrutiny. He wants Facebook to dominate the world. For several
years he closed staff meetings with employees all shouting “Dominate!”
Once the company went public he complied with legal advice that this was
an unwise ritual.
For the last few years, he has modified his publicly stated goal: Facebook wants to connect all people in the world, he says.
He said that when he addressed Wall Street in 2013. He repeated it,
when Facebook announced last October that Facebook would spend $200 million to acquire Onavo
an Israeli company that trims mobile phone costs for people in
developing and underdeveloped countries, a move that was also scorned on
Wall Street and the forgotten.
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