Will This Be Mike Arrington’s Last Post? – Facebook COO Sheryl Sandberg Video Interview February 3, 2009Posted by John in Technology.
Tags: facebook, Facebook for Kids, Linda Furrier, Mike Arrington, Sheryl Sandberg
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Enjoy this interview Sheryl Sandberg the Facebook COO at Davos. Mike Arrington grabbed her for a 9 min interview. One thing that I would ask Sheryl is how they are handling the policy for kids. As Linda Furrier posted last week, she has an opinion on Facebook for Kids.
Michael Arrington: I am here with Sheryl Sandberg, the COO of Facebook, and we’re at the end of the World Economic Forum at Davos. So, how was Davos for you this year?
Sheryl Sandberg: Interesting. I’ve been here before so you can kind of feel the different moods. I’d say this is the most somber Davos I’ve been to.
Michael Arrington: How many have you been to?
Sheryl Sandberg: Six I believe – four, a long time ago when I was working in the Clinton government, and last year. During the Clinton years there was an Asian financial crisis and I would say the mood then was not as up, but the pessimism was constrained to one part of the economic sphere, which was really Asia and some of the Latin American countries.
Michael Arrington: The NASDAQ was still way up then..
Sheryl Sandberg: Here there’s a real pessimism, and I think it’s earned – where is the economy going to bottom out? What don’t we understand?
Michael Arrington: This is your first Davos as a Facebook executive. Is it any different? Are people approaching you for different things? To talk about different things? What is this community giving you? What is this community giving you, what are you giving back, to this community?
Sheryl Sandberg: At Facebook we feel a lot of affinity not just for this community but for any community that is trying to do what Davos is trying to do, which is to share information. And Davos is doing it in a particular way – I think the Facebook approach is obviously more broad-based, we’re trying to include everyone in the world. But the goal is the same: bring people together, to share information and make the world more connected, and have people have a deeper understanding of themselves, others, the communities of which they want to be a part and can be a part. This has been a great year at Davos for Facebook. We’ve done a bunch of things including some polls from the stage, which has been really exciting.
Michael Arrington: Randi Zuckerberg did a poll that had around 500 responses in a matter of seconds..
Sheryl Sandberg: Yeah, I think the most compelling thing we had was there was a panel here which was on the situation in Congress with the US. And the panelists were talking about the stimulus package, and the assumption on the panel was that people were for it, and it would pass, there’s some tinkering to do. And Randi did a poll from the stage in twenty minutes, 120,000 responses, 70% of whom were against it. They said, “I don’t believe in the stimulus package”.
Michael Arrington: This was during the panel..
Sheryl Sandberg: During the panel, real live, 120,000 responses. Now it’s not a representative full sampling of the US population, but that’s a lot of responses. It completely changed the panel… The panel then were talking about, “wow, a lot of people are against this, what are we going to do?” And I think that’s exciting because Davos is a pretty exclusive thing. And the voice of people who were not invited – while everyone is always trying to get it in here, I don’t know how much you can do that.
Michael Arrington: Yeah, but you inserted it directly into a panel.
Sheryl Sandberg: Yeah, and the times I’ve been here [it was] the most direct voice of the people I’ve seen inserted into a panel so I think that was pretty exciting.
Michael Arrington: Was that an on-the-record panel with the video up on the site?
Sheryl Sandberg: I don’t know… It’s pretty exciting to take real people living in the real world, their opinions, and have people have to react to that. As opposed to their perceptions of what people are thinking, which are often very different.
Michael Arrington: So how was your first year at Facebook? We’re coming up on the one year mark in March.
Sheryl Sandberg: Yes, coming up on the one year mark. It’s been great. Facebook is a really exciting place trying to do something really important that I really believe in. And it matters. You go to different things from users to marketers to people like Obama running for office, who really want to connect with people and want a more authentic way to communicate and to listen and I think we are one of the forces and in some ways the leading force helping to provide that and that’s just a really exciting thing to be a part of.
Michael Arrington: How many users do you have now? 150 million?
Sheryl Sandberg: 150 million..
Michael Arrington: But it’s actually above that, you just don’t announce it. Every few months..
Sheryl Sandberg: *Laughs* We update it regularly.
Michael Arrington: Why does Comscore say 200 million people visit the site every month? Is it just Comscore is off or…
Sheryl Sandberg: An active user for us is someone who comes every month, at least once a month. I don’t know exactly how Comscore is measuring it.
Michael Arrington: You realize it’s like 1 in 5 people in the world that are on the internet visit Facebook.
Sheryl Sandberg: So we have 4 in 5 more to go. To get everyone connected. Joking aside, we want everyone in the world to be connected. Through Facebook, through technology, not just through us. But we really believe in enabling people to be their authentic selves on the web, and enabling people to communicate directly with each other in a very personal way.
Michael Arrington: So.. Revenue. You own revenue in the company, is that right?
Sheryl Sandberg: I definitely work on revenue, have responsibility for revenue.
Michael Arrington: So what’s monthly revenue now?
Sheryl Sandberg: Oh, you know, three dollars. $3.52 precisely.
Michael Arrington: How do you feel about revenue, where do you feel the big growth opportunities are? Do you have any new products? Micropayments for the developers, anything like that that you’re willing to talk about now?
Sheryl Sandberg: No product announcements on this video, that will disappoint but not surprise you. But you know it’s funny, a lot of people will say, “what’s Facebook’s business model?” I always find that a kind of funny question. Our business model is out there, which is: we monetize largely through advertising and a little bit through the gift revenue, the virtual gifts we have on our site. I think those continue to be the most promising avenues going forward. I think what you will see from us – you’ve seen from us some last year but you’ll see a lot this year – are the evolution of the advertising products so that they can be more targeted for advertisers and provide useful interactions for users. And I think we’re actually having a good year so far, a good quarter, and looking forward to more growth.
Michael Arrington: So you have direct ad sales, you have a team, and then you have the self-serve ads and we’ve actually looked at the self serve ads quite a bit and advertisers seem to love that. You said you have virtual gifts, but what about that micropayments platform for developers, I mean that’s a way for you to make additional money and they’re begging for it.
Sheryl Sandberg: Nothing to announce today.
Michael Arrington: Didn’t you guys already announce it a year ago?
Sheryl Sandberg: Yeah, we did do that… We haven’t updated that announcement and part of being a startup is, you know you announce things, you try to get there… not going to give anything else. Other than the $3.52. Obviously a very specific announcement.
Michael Arrington: Give me one thing then, give me more than 5,000 friends, this was promised to me personally not a year ago but close. And they’re just piling up. The friend requests are just piling up. And I know it’s only a small percentage of users have that need for more than 5,000 friends, but I’m one of them. When do I get that?
Sheryl Sandberg: I’m not going to give you a specific date, but I will reinforce the message that this is coming, and more importantly tell you why we think it’s important. Because you have these friend requests because people genuinely want to hear from you and genuinely want to connect with you. We’re not providing that functionality and we think that’s important so we are working on this and we’re working on it currently. We look forward to your having 80,000 friends… 100,000 friends.
Michael Arrington: I want to be friends with everyone that wants to be friends with TechCrunch. I don’t know if they really want to be friends with me or if they want to be friends with TechCrunch. But I want to add everyone, right now they’re piling up. What do you think of your hotel? I forgot to ask you that.. I’ve asked everyone that. It’s a 2 star hotel at a 5 star price.
Sheryl Sandberg: Yeah, it’s not the nicest hotel I’ve stayed at this year. I was a little scared at first because I walked into the room and there was no bed. I have a Murphy bed.
Silcon Valley Story: Twitter Please Don’t Be Web 2.0 Pointcast – Don’t Pull a Pointcast November 25, 2008Posted by John in Technology.
Tags: facebook, Pointcast, twitter
Let me get this on the record: I love Twitter. From the day that my friend Dan Bricklin showed me Pyra I’ve been watching Ev and his team at Pyra, Odeo, and then Twitter I have been a big fan of those product guys.
Twitter has been a ‘whale of a hit’. I remember when I started PodTech we moved the needle with Twitter at SXSW in 2007 not only was it fun, but it was effective. Since that time in early 2007 Twitter has gone and continues to go mainstream. Many people use Twitter as a way to communicate to peers and friends while some use it to promote their wares (PR firms and social media wannabees).
Here’s my point: I hope that Twitter doesn’t become the Web 2.0 version of Pointcast. For all you not familar with the storied company they were a big Web 1.0 company with massive hype and viability. In fact their product paradigm was awesome. Except for some minor fatal flaws – like price of bandwidth and massive changes in clients software (browser) – it was a great product.
The final nail in Pointcast’s coffin was their blatant turn down of a $300 million+ offer from News Corp. Pointcast’s hubris reject the News Corp offer. Why? They were drinking the Web 1.0 kool aid – they thought they were on the verge of riding the wave of the Dot Com gold rush. That bubble popped and Pointcast was sold for like $2 million (mainly IP) a few years later.
Now here we have Twitter having a ‘whale of time’ enjoying their success and constant outage. Facebook offers $500 million and they turn it down. I love Twitter but I think that you’re on the verge of pulling a Pointcast.
Facebook COO Sherly Sandberg Desperately Looking For An Ad Model October 7, 2008Posted by John in Technology.
Tags: facebook, online advertising
Here is an AdAge story about Facebook and their need to find the revenue model.
Rob Hof Editor-in-Chief at Businessweek comments and links to his view (he was there) below that Sheryl Sandberg main point yesterday is not what AdAge was reporting. It seems that Sheryl was saying that the only thing around today is demand gen. Thanks Rob. Rob also points to Mediapost which has a followup. Apparently the real twist in this is that the Advertisers want a solution. This sounds familiar – I feel like I’m in early 2000 again. Search went through this growing pain. Whoever delivers the solution will ‘mop’ up the revenues. THANKS ROB
Over on the metarand blog there is a good post on this by Randal. I like his analysis but would disagree with Randal on the monetization focus and his reference in Jeremy Liew regarding to online advertising growth. Online advertising is a growth sector and will NOT slow down in the medium to long term. Maybe short term yes but long term massive dollars are going that way. If you look at the IAB stats from 1999-2001 there was gloom and doom. Then look at 2002-today. Massive growth. As Diller says no one has the answer yet.
Facebook’s latest attempt to finally get some real ad revenue has shown early signs of promise, Chief Operating Officer Sheryl Sandberg told an audience at the American Magazine Conference in San Francisco yesterday.
“The results were really positive,” Ms. Sandberg said. MTV not only got some attention for its awards show, it learned a little about what viewers wanted to see. It and other networks have subsequently said they want to try using the product earlier, to make the most of that feedback, she said.
“The monetization question on the web is a very big and open one,” she said. …Ms. Sandberg a former Google executive, noted. “What no one’s figured out how to do is demand generation,” she said.
“We need to find a new model and new metrics,” she added.
“Walled gardens don’t work,” she explained.
“People are using our product to protest our product,” she said, noting that a protest group is now the fifth largest on Facebook.
These quotes speak volumes about Facebook’s lack of awareness to how online advertising works. Pesonally I don’t think that they have to produce the monetization answer right now but instead just focus on the product leadership and key business development deals. I have no idea why Sandberg even entertains the monetization question at all.
Here is my favorite line from the Barry Diller interview on online advertising..
On Internet advertising: “You really want to get a headache? Try to understand Internet advertising. Social-networking advertising is being discounted because there is so much inventory [of available ad spots], and because methods have not yet been found to make it very effective. Will that get figured out? I absolutely believe it will. What form will it take? Absolutely unknown.”
Sheryl you have nothing on the ad side yet just admit it and work with advertisers to get the right solution in place.
Tags: Eric Eldon, facebook, IPO
Eric Eldon editor at Venturebeat has confirmed his investigative story on Facebook. Yesterday Eric broke the ground on the story that Facebook is letting employees sell some of their shares. Hey it’s all about getting liquid
In a turn of events Eric also reports LinkedIn is doing the same.
What we have here folks is a mini or private Silicon Valley quasi-IPO market. In the absence of any liquidity option the Silicon Valley VCs and private capital markets need an outlet. This is self preservation of the Silicon Valley way.
I wonder what the implications are on a sort of mini-liquidity market? Personally I think this is a good thing to fuel some innovation and reward.
All this is a pre-text to the posturing that Facebook will stay private and not be sold. One poison pill to take is keeping early employees happy and rich.
Lets hope that Facebook doesn’t cause the wealth problem being experienced at Google – the haves and have nots. As Google approachs thousands of employees who are underwater in stock verses the handful who have FU money. Facebook better be careful to make sure that new employees don’t feel alienated by the early guys getting rich in a private quasi-IPO.
Overall I’m a fan of liquidity.
Facebook Manufactures Liquidity for Employees – Good Move August 4, 2008Posted by John in Technology.
Tags: facebook, microsoft
Eric (on a roll) Eldon is reporting that Facebook is going to announce that it will let employees “cash out” at an internal valuation of $4b. This amount is well under the valuation that Microsoft placed on the company.
Facebook has an internal valuation of $4 billion, as Venturebeat previously reported. It will begin letting current employees sell 20 percent of their fully vested stock options at that valuation, starting this fall.
Ok I think that Facebook’s engineering of an liquidity event for their employees is a good thing. I’ve said on this blog that Microsoft’s run at buying Facebook was their IPO.
My sources inside Facebook and at Microsoft both admitted that employees at Facebook were getting restless given that an IPO is not in sight. The opportunity for employees to sell some of their vested shares in this deal is great for employees and good for the company.
Tags: facebook, Facebook Connect, Unified Communication, web 2.0
Walled garden is a bad word in Web 1.0, but maybe not in Web 2.0 web services. In Web 2.0 and Unified Communications “presence” is a big concept and a battleground for the convergence play – the real Web 2.0 opportunity. Over at GigaOm Om writes about his views on Facebook Connect announced yesterday at the F8 2nd annual developer conference.
Walled gardens conjure up memories of AOL. No user value with vendor lock-in. Is Facebook creating a ‘virtual walled garden’ for their lock-in?. Absolutely. What is a virutal walled garden – a place where users originate and let apps and information come to them. It could be the best user experience (one of user choice) a kinds of safe harbor from the clutter on the web that we are seeing today. I think that the Facebook developer story is moving to an approach where apps and information come to the user by design. Where users have a choice to leave at anytime, but the value of the experience creates a comfortably numb user experience that makes them stay.
If I can have my presence sit at Facebook and it can let value come to me via intelligence then I like that. Facebook could be a personal agent for me using my data, their data, machines, and developers apps do all the work. Letting Facebook and my social graph do work for me can be a good thing. This is the original Google value proposition. However, it’s the opposite of Google. It’s discovery and navigaiton in reverse. It’s automated reverse navigation. The social graphs work for me the user. No silos, no requirements, no extra steps, time savings just value.
This line is very telling from Om’s story: Each service adds a few more data points about you inside the Facebook brain, which is quite aware of your activities inside the Facebook ecosystem. The brain can then crunch all that information and build a fairly accurate image of who you are, what you like and what might interest you. With all that information at its disposal, Facebook can build a fairly large cash register.
In my view Facebook is land grabing the presence component of what is looking to be a paradigm shift that will disrupt the Web 2.0 and Unified Communciations sectors (covered at BroadDev.com).
Other Web 2.0 services like Twitter et al have a unique presence component as well but they might just be a feature not a company. Silo’d platforms might not make it going forward.
Facebook might just force a defacto standard in presence by their dominate position at the user level (90 million and growing).
Could presence be ripped away from the emerging segments like Unified Communications platform and converged into an environment like Facebook? To me user value will win and if users prefer environments like Facebook where information and applications come to them then that might just force some massive change across the board.
Vertical silos might be demolished by open horizontal networks. Interesting development if that happens.
Is it the walled garden of Web 2.0?
Tags: entrepreneurship, facebook, Innovation, silicon valley, VC
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The NY Times is doing a followup piece to my post called The Zuckerberg Opporunity. They are following up on my first post and story called The Zuckerberg Opportunity. The Zuckerberg Opportunity was a followup on the story on the big story that I have been tracking on Microsoft buying Facebook. The NY Times goes deeper into the deal side dynamics of the Zuckerberg Opportunity. (Note: I’m glad to see the NY TImes run with my original piece – it needs deeper analysis and more detailed reporting – thanks Steven)
NY Times DealBook has a great followup post to my post Zuckerberg Opportunity. The professor Steven Davidoff pens a detailed post around some of the tactical challenges around the Zuckerberg Opportunity.
What’s interesting here is how Silicon Valley and the VC community will respond to this. Silicon Valley has been an environment where the VCs have always maintained a balance between the ‘greed’ part of their job with the ‘unwritten’ rule of maintaining the legacy of Silicon Valley.
Lately, we have been seeing an environment lately where VCs really don’t care about screwing entrepreneurs over for a quick buck or shutting ventures down over political internal VC partnership fighting. If this trend of not building great sustainable companies continues then the legacy of Silicon Valley will be at risk.
I love Silicon Valley for what it has been famous for – innovation and the celebration of entrepreneurship. An enviroinment that rewards innovation, entrepreneurs, and entrepreneurship will create great companies and yield great profits for investors.
If Silicon Valley becomes known as a place not friendly to entrepreneurs and quick rich VC plans, then the legacy of Silicon Valley is at risk.
Zuckerberg’s Opportunity – The Silicon Valley Way – Be Extraordinary Create the Market Make Money; It’s All About the Founder May 20, 2008Posted by John in Technology.
Tags: Extraordinary, facebook, microsoft
Kara Swisher writes a memo to Mark Zuckerberg about the possible scenarios facing Facebook. She references my post called Facebook IPO – It’s Microsoft Not The NASDAQ . I see this as an opportunity for Facebook. Recently Facebook has been hiring ‘quote seasoned executives’. Facebook’s future is in Mark’s hands – it’s all about the founder.
Silicon Valley has two kinds of companies: 1) build real long term value for employees, investors, and build a great culture, and 2) build a value proposition (venture backed) and sell making the venture capitalist rich and the founders rich. We haven’t seen the kind of company like HP, Apple, or Google for some time (obviously Google is most recent). We have seen tons of companies sell out.
What makes a great company? The Founder and the founding team – Bill and Dave; Steve Jobs, Sergey and Larry; Facebook is stuck in the middle here. Strong founders with passion and drive to build a long term viable company and a cast of characters with ‘seasoned experience’. What’s more important seasoned execs or young and hungry founder led teams?.
In the final analysis it’s all about the founders. When founders get replaced the companies usually die. Why? Because Founders know best.. Founders see things others don’t. Founders can do deals, hire employees, lead people, create products, and do things differently. Founders are extraordinary people. Mark is one of those founders. He’s done amazing things at Facebook. The question is what does he do next.
The Silicon Valley Way is to build great companies, create markets, AND, create wealth for stakeholders (including employees – they don’t have employeess ‘resting and vesting’). Mark as CEO of Facebook has an opportunity now. He is at an inflection point. The same inflection point Bill Gates had when he had to negotiate his way around the big IBM monopoly to get a ‘killer’ license deal for DOS. Remember Google when they did something no one thought was possible – they ran their IPO as an auction and create dual classes of stock. Why? Because the founders were extraordinary.
My advice to Mark – do something extraordinary – stop the PR Bull; Make a strong move in this market – Be Extraordinary.
Microsoft needs you and you need Microsoft – If that doesn’t work substitute Google for Microsoft.
Mark: you are in the drivers seat. Take the cash and structure something extraordinary. Remember going public isn’t the dream job – shareholder bickering, filings, tons of BS.
This is an extraordinary situation in a time in history where conventional wisdom is irrelevant.
UPDATE: NY Times DealBook has a great followup post to my post Zuckerberg Opportunity. The professor Steven Davidoff pens a detailed post around some of the tactical challenges around the Zuckerberg Opportunity
Tags: facebook, MicroHooBook, microsoft
Facebook is saying that they want to be independent but it’s what they aren’t saying that’s very telling.
Facebook CEO Mark Zuckerberg stresses in a Reuters story that Facebook will not be sold. In response to my blog post of the rumored Microsoft move post Yahoo Search buy this week, Mark denies any deal.
The fact that he is so defensive creates an interesting posture for Facebook. Coverage is so deep on this possible Microsoft Facebook move that something is brewing and fast. I think that it’s a good move for Microsoft to make a bid for Facebook. A Microsoft Facebook combination puts a credible force to compete with Google. Many of the bloggers agree this is a good possibility for both Microsoft and Facebook.
Facebook’s recent moves say alot about what’s going on. For example Facebook is so afraid of Google that their move to shut down Google’s Friend Connect is their version of a ‘save me cry’ except it’s a cry to Microsoft. Their move to shut down Friends Connect is like Yahoo saying to Google save me from Microsoft. Now Facebook is basically saying Microsoft save me from Google.
Tags: facebook, microsoft, yahoo
My sources say that the Yahoo and Microsoft teams are bunkered down in a Palo Alto hotel hammering out the final stages of a transaction that will have Microsoft picking up the Yahoo search business. Word is that this deal will be done this week. While this is not surprising, it does bring to question the motives and plans of Microsoft.
Why would such a complicated transaction (just Yahoo search with all the headaches and all) be in the cards for Microsoft? After the failed bid for $40 plus billion for all of Yahoo, Microsoft’s intentions are clear. Buy the search business from Yahoo and take that team and go spend at least 20 billion for Facebook. Integrating the search team at Yahoo with Facebook puts a formidable army to take on Google.
What a move this makes. Yahoo gets everyone off their back, Microsoft gets a credible position in search, and buys Facebook to compete with Google. The price about $45 billion.
This is going to be good.
Update: here is a post from Kara Swisher - Microsoft’s Kevin Johnson’s “We Can Compete” memo - Microsoft needs Facebook and Facebook needs Microsoft.
Update 2: Robert Scoble (my former employee ) is taking my report of Microsoft buying Facebook conversation to the next level. This will be developing further but in the meantime the jockeying is going on. This explains the recent moves at many levels… take the employees of Google leaving to join Facebook.. Facebooks posture toward Google, and the general platform behavior lately of Facebook. Maybe they knew that they were pulling a Netscape last week – knowing that Microsoft guns for hostages were coming into town.
Update 3: This is why I love this guy Umair.. Leading minds see the strategy…good post Umair.