Photo: Wojtek Balczun via Facebook
In the past few days, as Facebook’s stock has continued to collapse, a growing chorus of people have been suggesting that Facebook CEO Mark Zuckerberg needs to say something.Specifically, the grumblers say, he needs to momentarily interrupt his honeymoon and make a statement.
Yesterday, I was one of those grumblers.
I thought Mark Zuckerberg should calmly, confidently remind everyone that–even though he is on his honeymoon–he is aware of what’s happening to Facebook stock and Facebook investors.
I thought Mark Zuckerberg should continue his statement by saying that, while this was certainly not the public-market debut Facebook had hoped for, he remained laser-focused on what he had always been focused on, which was Facebook’s long-term opportunity, not the stock price.
And I thought Mark Zuckerberg should also, quietly, refer everyone back to the letter he wrote in Facebook’s IPO prospectus in which he stated clearly that:
- Facebook cares more about its “social mission” than its business
- Facebookers do not get up in the morning with a desire to “make money”–they wake up with a desire to build a great service
- Facebook will not pay any attention to short-term fluctuations in the stock price (Mark didn’t say this explicitly, but it couldn’t have been clearer)
That letter, after all, was a three-alarm klaxon warning anyone who cares about short-term stock performance to stay the hell away from the stock. And it’s one of the reasons I was very cautious and sceptical about the price IPO investors paid for Facebook stock.
I thought this statement would serve the same function as an aeroplane captain getting on the intercom when the plane enters turbulence to tell passengers that everything’s fine. It’s reassuring. It reminds everyone that the captain’s paying attention. It’s an indication that the captain isn’t just off fiddling in, well, Rome while the aeroplane burns.
And I still think Mark Zuckerberg could say that.
But his saying that would also create problems in the future.
Namely, it would set the precedent that, contrary to his crystal clear letter in the prospectus, Mark Zuckerberg DOES care about short-term fluctuations in the stock price. And he WILL adjust the company’s communications strategy to deal with them. And he DOES owe short-term investors something.
In short, it will set the precedent that, despite the enormous lengths it has gone to insulate itself from the short-term pressures and squawking of public-market investors, Facebook is just like every other company: It will dance around at the beck and call of short-term speculators like a puppet on a string.
Facebook was smart to set itself up to resist that pressure.
And the current stock collapse is the first big test as to whether the company can walk that talk–or whether it was just talk.
Based on Mark Zuckerberg’s ability to withstand criticism thus far in his career, Facebook’s stance on this is not just talk. The company really means it.
So, to underscore that, I now think that Mark Zuckerberg should NOT say anything.
He should finish his honeymoon.
And then he should get back to work.
And in a few weeks or months, when the stock finally settles, everyone will have forgotten about all this. Just the way they’ve forgotten the rocky start of one of the more famous “broken IPOs” of the 1990s…Amazon.