Besides Beacon, he seems to interview pretty poorly, Facebook is still hemorrhaging money so he hasn't managed the whole "profitability" thing, and there's the whole ConnectU fiasco to name a few. Considering the fact that he's 24 and running a place like FB, I think he's done a good job all things considered, but the award was for "Best Startup CEO" not "Best Startup CEO who is still young so doesn't really know he is doing, but is doing pretty well in spite of his lack of experience."
Because that would be way too long for Om Malik to say remotely coherently.
(P.S. I think I would make an awful CEO of FB, but I also think there are far more competent Startup CEOs out there than Zuckerberg, it just so happens he gets a ton of press, which means it makes sense that he would win an award that is determined by a mass of mouth-breathing, TC-reading publics. Sort of like how it makes sense the Twitter founders won "Best Founders" since, apparently, any press is good press, even press that constantly points out how incompetent you are.)
It's not necessarily a mistake to focus on growth instead of revenue, especially in the business they're in. It was certainly right to focus on growth initially. At some point there is presumably a threshold where revenue becomes more important. Are you sure you know better than Zuckerberg where that threshold is?
I'm not. I wouldn't want to bet their strategy has been optimal, but I wouldn't want to bet against it either. At the (very coarse) precision at which I can judge, their strategy seems optimal. Can you judge with finer precision?
If I had a 150MM users, I'd start worrying more about how to monetize them than I would about getting more. Facebook has been around 5 years, has taken over 500MM in funding and still requires a yearly influx of investor capital to keep running. To me, that signifies a problem (or, if not a problem, at least an early warning bell). I cannot judge with any finer precision, but from my perspective the strategy is no longer optimal.
I suppose sometime within the next decade we'll find out who was right. Although, given the choice, I will pretty much always bet against a bread-and-butter social network like FB. Statistically it's a really safe bet.
In a market where there's a tendency toward centralization, what matters is the percentage of users you have, not the absolute number. Facebook only passed Myspace in traffic last month. Surely it's at least reasonable to believe the threshold for when to put revenue first might be in the future.
Do you have to be the #1 in a sector to make a lot of money though?
Plentyoffish has just overtaken match as top dating site in the US - some parallels with facebook. Difference is, plentyoffish has been massively profitable for years... Why hasn't facebook? Do they need 10,000+ servers and all those staff? The big fancy expensive offices?
Facebook seems like a tech bubble in itself to me.
Zuckerberg is taking the road less traveled. Most sane people would have cashed out $100MM and walked away as soon as they could have. I would have.
He's trying to turn Facebook into a billion+/year revenue company by utilizing an as of yet proven (or identified?) business model.
Worst case scenario is that he could do what MySpace did. Put horrible ads all over the site and milk it for everything it's worth. Should turn profit if they then cut back on spending (and fire 80% of their staff).
Releasing features users don't like is not necessarily a mistake. You can never tell for sure whether users will like something till you release it. So the optimal plan for a startup is to keep releasing new stuff, and when something sucks, admit it fairly quickly. Which I believe is what they did.
