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At Facebook It’s Service First, Business Second

09/04/2012

“Simply put: 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.” This statement came from someone you may have heard of but wouldn’t likely attribute those words to…Mark Zuckerberg, CEO of Facebook.

While Facebook shareholders are grumbling about share prices and Zuckerberg’s fitness as CEO, Zuckerberg is on a mission to make the world more open and connected. I love it!

I can’t recall the last time CEO, especially one with virtually no public company experience, expressed a big picture perspective on a business that’s measured in decades…not quarters. More importantly Zuckerberg is focused on what Facebook creates (services), not what it does…as a business. Specifically, what Zuckerberg cares about most is Facebook’s product and service and “social mission.” The business is secondary. Impressive.

I didn’t buy into Facebook’s IPO and I’m glad. At its opening Facebook traded at about 60-times the following year’s projected earnings, in a market in which other hot tech companies like Apple and Google were trading at less than 15-times. Even at today’s prices the stock is around 28 times earnings – so it’s entirely possible the price will continue to drop. It might be a better buy then.

Until that time don’t look for Mark Zuckerberg to be a withering violet when it comes to the whining of short-term investors. Zuckerberg is in it for the long-term and the right reasons.

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