Mark Zuckerberg is speaking this afternoon at TC Disrupt, a tech conference in San Francisco.
He’ll be interviewed by Mike Arrington, a venture capitalist.
What most Facebook investors want to know is what Mark Zuckerberg is going to say to win back their trust now that Facebook has tanked 50% since the IPO.
I don’t know what Mark Zuckerberg is going to say about that.
But here’s what he should say:
He shouldn’t comment on the stock price at all, except perhaps to acknowledge that the stock hasn’t exactly been a winner. (He, as the largest Facebook stockholder, has suffered most of all).
Instead, Mark Zuckerberg should adopt the attitude and tone of the tech Founder/CEO to whom he is often favourably compared, Jeff Bezos of Amazon.
Jeff Bezos of Amazon, if memory serves, has never said anything publicly about his stock price.
What Bezos has said, time and again, is what Ben Graham once said about the stock market, which is that, over the short term, it’s a voting machine, and over the long term, it’s a weighing machine.
In other words, Bezos has reminded folks, over time periods of days, months, and years, stock prices go up and down depending on the mood of the market. Other long time periods, however, stocks follow the fundamentals of the underlying companies.
And that’s all that Mark Zuckerberg should say:
“At Facebook, we don’t focus on the stock price. We focus on Facebook–on our product, our users, and our clients. We firmly believe that, if we build a great product and company, the stock price will take care of itself.”
And it will.
If Mark Zuckerberg is in a show-and-tell mood, he could post the following chart of Amazon’s stock price from 1997-2012 (Amazon’s much higher than that now, by the way):
Mark Zuckerberg could then observe that, if Amazon had focused on its stock price instead of its company, it might have wasted the years from 2000 to 2008 desperately trying to find something, anything, to do to get the stock price up–instead of doing what it actually did, which was continue to build an awesome global company.
Over the long haul, stock prices do take care of themselves.
Mark Zuckerberg has been crystal clear from long before Facebook’s IPO that he wasn’t going to make short-term decisions to appease upset public stockholders, and he should stick with that view. He should refer any investor interested in what Facebook’s stock might do, or whether Facebook’s stock is a buy or a sell, to the dozens of Wall Street analysts who cover Facebook stock.
And then he should explain again, as he so often has, how obsessed he and his team are with building an amazing global service and company.
Because, over the long haul, regardless of what he says, the stock will take care of itself.
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