Facebook Faces the Music From Investors
Barely a year after its disastrous IPO, the time finally came for Facebook's executives and board of directors to face the music at an annual shareholder's meeting.
Facebook’s investors got their first chance to take questions and complaints straight to the top yesterday. Barely a year after its disastrous IPO, the time finally came for Facebook’s executives and board of directors to face the music at an annual shareholder’s meeting. The range of questions and comments from stockholders bordered on the ridiculous, such as when their favorite Facebook game would be coming out of beta (an issue the company has no control over), to the more important matter of when the company will regain the value it has failed to achieve since the day of that ill-fated IPO.
“We understand that a lot of people are disappointed in the performance of the stock and we really are too,” says chief executive Mark Zuckerberg. “The real question is what are we going to do about it. We’ve always taken a pretty long-term view of this,” he says, adding that the company expects fluctuations in how the public and Wall Street perceives Facebook’s position in the market.
“We don’t think that we’re going to be the only company in this space, but we want to be the one pushing it forward,” Zuckerberg says. “This isn’t a zero-sum game. The market is expanding quite quickly.”
Facebook’s mission is to make the world more open and connected, he adds. Facebook wants to set itself apart by building great mobile apps, a platform that brings a social element to other apps, and a strong economic engine that can fuel its vision for a long-term business.
While Facebook’s stock price languished over the last year, the company undertook an all-too-familiar transition from desktop to mobile. It hasn’t been easy, but Zuckerberg says the company made a lot of progress on that front, particularly with its entirely rewritten apps for iOS and Android. “More people are coming to mobile apps on any given day than desktop, which was a really big shift for the company,” he says.
Zuckerberg adds that he’s especially excited about what Facebook can do with location and other attributes of mobile that it couldn’t do with desktop. “We’ve started to plant some seeds with products like Home that can really be future versions of how people use Facebook,” he says.
“Home is a product that we were working on for a while, for months. The idea is to create the mobile-first version of Facebook,” adds Zuckerberg. “Home is the first version of Facebook that was really designed from the ground up to be a mobile product.”
He chose to get in front of some of the criticism that’s been lobbed at Home as well. “There was no real way that we were going to get everything right the first time,” he says. “We haven’t really made our big push for it yet…Until we do that, we’re still kind of in tweaking mode.”
Zuckerberg says Home will see more improvements before Facebook begins to encourage about 100 million active users on Android to make the switch. The transition from desktop to mobile has also forced Facebook to rethink its advertising business, he adds.
“One of the big shifts that we’ve had to make is so that the ad formats that we have work on desktop as well as mobile,” he says. “Now, as of last quarter, 30 percent of the revenue of the company comes from mobile ads, up from roughly zero a year ago.”
COO Sheryl Sandberg says Facebook has also made important strides in answering the question of measurement and proving the value of the platform as a marketing vehicle. “We are a social ad spend and we have worked increasingly to help our advertisers increase their return on spend,” she adds.
In other news, Facebook took yet another play out of Twitter’s playbook and announced that it too will be a haven for hashtags. Facebook is making hashtags searchable and clickable to help marketers join and drive conversations about their business. And it will all be organized just as Twitter does it, via the omnipresent hash mark.
