By: Bram Schumer
Facebook CEO Mark Zuckerberg has big dreams, and even bigger expectations to meet. The social media company’s public offering earlier this year was given nearly as much coverage and excitement as the London Olympics, only to disappoint investors when its share price plummeted over the summer. But however cheap it is to buy Facebook stock these days, it’s official: the new guard of American industry lies at the fingertips of those in Silicon Valley.
People flock to California today not for gold, per se, but for the opportunity to be the next big thing. The next big gadget, next big app, next big way to take picture of food and write a caption of “nom nom” beneath it. It’s no wonder that businesses of all stripes are turning their attention west for ideas on how to make their own companies hum with the same ingenuity, excitement, and irreverence for the rules. Mark Zuckerberg, the CEO who wears a hoodie and flip flops even to the New York Stock Exchange, and built Facebook into one of the most powerful and popular digital tools of all time, knows a thing or two about capturing and nurturing the energy of a startup, and turning an ambitious idea into a profitable venture. When Mark speaks, the world should listen.
Last month, the 28-year-old sat down with Michael Arrington for an interview at Tech Crunch’s “Disrupt SF 2012” conference. It was Zuckerberg’s first public appearance since Facebook’s IPO, and there were many questions to be answered.
But rather than buckle under the pressure of the worlds of both technology and finance, the fast-talking executive put his business acumen on full display, showing fan boys and worried investors alike that he’s the right man to lead Facebook through its recent troubled times and towards a brighter, more connected future.
Zuckerberg has something to teach us. Sure, he’s wildly successful, one of the youngest billionaires in the world, and can even speak Chinese. But beyond all of that, he proves that he understands Facebook’s mission, and makes every decision with that mission in mind. “We don’t build services to make money,” he said, “we make money to build services...we are a mission-driven company.”
What can your company learn from the lessons of Facebook? Quite a lot: everything from focusing your mission, to dealing with the ups and downs of the press, to being able to admit and grow from mistakes.
Let’s jump in.
#1: Know your mission, and make decisions based on it.
Too often, companies start out with the intention of doing X, only to end up doing Y as the pressures of marketers, committees, and shareholders build up. Even Apple, which many consider to be one of the most focused companies in the world, struggled throughout the 1990’s under poor leadership, bloated product lines that confused consumers, and too many decisions that were made to save a buck here and there. Their mission, to make the best consumer electronics in the world, had been lost. And it wasn’t until the return of Steve Jobs in 1996 that focus returned and products were terminated to make room for today’s elegant devices that we can’t live without.
Facebook’s mission, in Zuckerberg’s words, is “to make the world more open and connected.” How do they do it? By making the sharing of information, everything from a picture to a status update to a friend request, intuitive and fast. “We exist and we wake up in the morning and the thing that gets us excited is making the world more open and connected and the things that we’re doing to build that.”
To do this, Facebook had to build an effective team who all believed in that mission as their top priority. When everyone in your organization understands and embraces your mission, decisions are made for the right reasons, not superficial ones.
#2: Stay focused in spite of the media’s turbulence.
As Facebook’s stock price sunk over the summer, investors became worried. Articles were published; accusations flew. It seemed like Facebook, this enterprise which everyone thought was the greatest thing ever to happen on the Internet, wasn’t so good after all. The effect of all this media scrutiny wasn’t exactly good for internal morale. “It doesn’t help,” chuckled Zuckerberg.
But despite the media circus, Zuckerberg kept his employees focused by reminding them that the media exaggerates everything, the good and the bad. “Facebook has not been an uncontroversial company in the past,” he said. When Facebook seemed on top of the world, the press was saying things that were too good to be true. And when they’re saying things that are bad, he reminded his team not to lose hope because they’re never as bad or as evil as journalists make them out to be. Using the media to your advantage is important, but allowing the cyclical highs and lows of the public’s perception to distract you from your goals is never the way to build confidence or inspire others.
#3: Admit your mistakes. And grow from them.
Anyone who used, or still uses, the old version of Facebook for mobile knows how terrible it was. Images would take a ridiculous amount of time to load. Pages crashed. Posts would get lost. Eventually, people forsook the app in favor of the mobile website: a more cumbersome process which wasn’t what Facebook had in mind. Back then, the technology behind the app was called HTML5. Every time you clicked on something in the app, the webpage had to load and render, which took tons of time and gobbled up precious carrier data quotas. At the time, Facebook believed HTML5 was the future of mobile apps. Big mistake.
“I think the biggest mistake we made as a company is betting too much on HTML5,” said Zuckerberg. When you and the people at your company are self-critical, and accurately and fairly assess your own performance, you can quickly adapt to changing circumstances and avoid getting stuck in a rut. After about a year of trying and failing to make HTML5 work, Facebook switched their app to a “native” format, which basically means more processing happens on your phone rather than the Internet, making it more stable and, crucially, faster. Facebook’s odyssey of HTML5 to native taught us that there’s no shame in admitting mistakes. If you learn from them, your customers and stakeholders will thank you in the end.
#4: Build effective partnerships. You can’t do everything alone.
Earlier this year, Facebook made headlines when it bought the photo sharing app Instagram for $1 billion. Instagram, which allowed anyone with a cellphone to shoot photos, add cool effects, and upload them to their Facebook feed, had become exceedingly popular, and Zuckerberg was taking an interest. He began meeting with Kevin Systrom, Instagram’s founder, to discuss their goals and ambitions for their respective companies. Zuckerberg likes to support entrepreneurs and innovation, and build meaningful relationships with the third parties that make Facebook more useful to people. After discussing their plains and goals for a while, the two men realized, “hey, maybe we should just join and become one company.”
While doing a merger with your partners isn’t always the best choice, what Zuckerberg shows us is that it’s important to think about your customers, their lives and preferences, and what other products and services they might be using. Then, consider forming partnerships with other companies that serve these same customers. It will add value to both of you.
#5: What you say “no” to is as important as what you say “yes” to
During Zuckerberg’s interview, Michael Arrington pressed him on a rumor that has been swirling around the tech world for months: is Facebook secretly working on a mobile phone that could disrupt the success of Apple and Google? Such a rumor is juicy indeed, and to the average consumer, a Facebook phone is enough to stop yourself from running out to the nearest Apple Store for an iPhone 5, lest Facebook manage to one-up it just months later. Zuckerberg, however, was adamant. “Building a phone is so clearly the wrong strategy for us.”
With 950 million users, and an obvious cultural cache, Facebook could certainly come out with some sort of product, and probably convince a few million people to buy it. But what would that do? Is Facebook really a mobile device company? “Let’s say we build a phone,” said Zuckerberg, “maybe we could get 10 million people to use it. 20 million. It doesn’t move the needle for us...we want to build a system which is as deeply as possible integrated into every other major device.”
While companies often keep major plans secret, and no one knows Facebook’s future for sure, based on Zuckerberg’s insistence, it seems safe to say that for now, there is no “Facephone” on the horizon, and for good reason. Facebook has a lot on its plate right now: rebuilding shareholder confidence notwithstanding. To devote millions of dollars and countless hours and resources to a product that Facebook was never intended to create would divert its attention from the products and services that make it great. Too often, companies get excited by “sexy” opportunities that they would like to see happen. Apple used to make clothes. Coke tried “New Coke.” Blackberry came out with a clunker of a tablet. What these ventures all had in common was that they didn’t fit into the company’s mission. They were distractions.
Discipline can sometimes feel limiting, like you’re preventing yourself from reaching your full potential by saying “no” to too many things. Example after example, however, shows just the opposite. Companies that are truly focused on doing a small number of things exceptionally well, rather than myriad things mediocre, are able to easily pivot, respond to outside forces, and usher in innovation, because the cobwebs of stagnation and tradition never got a chance to form in the first place. Just because building a Facebook phone sounds like a cool idea, for now Zuckerberg is making the correct decision to shelve it for now, and focus on what’s truly important: making it fast and easy for a billion people to share and like pictures of cats.
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