All about the Benjamins, or How Mark Zuckerberg cemented control of Facebook $100 at a time
One hundred dollars doesn’t go very far these days.
But for Facebook co-founder Mark Zuckerberg, a C-Note was the key to cementing his control over the social networking phenomenon.
As we learned last week when Facebook filed its prospectus for a $5 billion initial public offering, Zuckerberg has the voting rights to shares owned by some of Facebook’s biggest stakeholders, including venture capital firm Accel Partners, Digital Sky Technologies and former Facebook President Sean Parker.
In an amended filing on Wednesday, Facebook provided a little more color about the agreements that contributed to Zuck’s controversial control of 57 percent of the company’s voting shares.
Most intriguing was the price that Zuckerberg paid each of the various shareholders in exchange for handing him their voting rights: $100 in cash.
That’s not a typo.
One hundred bucks may seem like a pittance for such an important right. But it’s possible that the $100 payment was merely a formality, and that forfeiting voting rights to Zuckerberg was the real price of admission for (the raging horde of) investors seeking to buy into Facebook.
Facebook makes us embrace creepy
By Kevin Kelleher The opinions expressed are his own.
Sean Parker was looking edgy. Maybe it was because he was sitting in for Mark Pincus, who bowed out of this week’s Web 2.0 Summit because of Zynga’s pre-IPO quiet period. Or because this was a chance to show a large gathering of his peers that Justin Timberlake, no matter how smooth, could never be a Sean Parker. Or maybe it was just because he was Sean Parker.
He shifted nervously on a black leather sofa as he was asked about Facebook’s new power, a power that leads many to see the company as fearsome and a little creepy. His posture hunched, his expression murine, his black wardrobe gothic porn, his eyes shifting around the room as he hunted for the precisely evasive word. Parker’s reply finally came in the form of a couple of sentences that might stick with him for some time: “There’s good creepy and there’s bad creepy,” he said. “Today’s creepy is tomorrow’s… necessity?”
It sounds so unpalatable coming from Sean Parker, but it’s true. After all, more people are sharing more information on social networks than they were a few years ago. In a way, Parker was just channeling Zuckerberg, who said in early 2010 that people will grow more comfortable with sharing information about themselves; and more recently that people will want to share more of their lives as each year passes, and that “it’s going to be really, really good.”
But whatever Zuckerberg proclaims, Sean Parker oozes. And in that ooze lives a truth of Facebook that Zuckerberg – and any profitable social media – doesn’t want you to know.
Parker, an early Facebook shareholder, said something that most of us don’t want to admit to ourselves: We are learning to love Facebook’s invasion of our private lives. We’re learning to stop worrying that our faces, our thoughts, our conversations with family and friends – the little moments that accrete into our everyday lives – are becoming data-mining fodder for advertisers and anyone else Facebook forges a revenue-generating partnership with.
We are learning to love creepy. If we don’t learn, we’re going to be left out of the party. We won’t know, for example, what our friends look like, in their far-flung residences, as they grow older. Or how adorable their kids are as they grow up. We won’t know what they just read, or what movies they love, or what new artists they are listening to – unless we phone them up or sit down to lunch with them.
It would be easier to accept the argument “if you don’t like the risk, don’t use FB” if all users were mature adults. People with enough life experience to weigh the social costs of having your every foible exposed to strangers who don’t know enough about you to put individual incidents or missteps into context. When I was in high school or college, just like most any kid that age I figured that the opinion strangers may form of me through rumor and hearsay meant less than nothing. Now I know that alas, it’s not true. Underinformed idiots do have power to ruin a life for no good reason. Fortunately for me, whatever past awkward moments I may blush to admit of now have left no trace. For my own children, it will not be true. And as a parent, I don’t delude myself that any lecture I may give about being prudent online will outweigh peer pressure from friends and classmates. So yes, I am worried. Any parent of teen or young adult should be.
What’s cooler than a Facebook conference? A Sean Parker after-party.
When somebody who was played by Justin Timberlake in a Hollywood movie decides to throw a party, the expectations are pretty high.
And Sean Parker, the man behind free music-sharing service Napster and an early Facebook advisor, clearly likes to give people what they want.
Parker, who is an investor in the music service Spotify, pulled out all the stops in a post-Facebook developers conference party on Thursday that was a cross between a backstage concert pass and Trimalchio’s feast.
The party was reminiscent of the dot-com boom era in the late 1990s, when extravagant blowouts thrown by well-funded startups were practically a weekly event. A decade later, Web company valuations are on the rise again, led by companies like Facebook, Groupon and Zynga, and talk of another tech bubble is in the air again.
This time around of course, the broader economy is sputtering and unemployment is stuck at 9.1 percent. But Parker’s party, which took place in San Francisco’s Potrero Hill neighborhood, underscored the euphoric atmosphere among the engineers, executives and venture capitalists in the Internet industry.
Those lucky enough to score an invite were ferried in private buses to a graffiti covered warehouse that Parker had converted into a lavish den of decadence, with spit-roasted pigs, sashimi bars, ice-chilled Dungeness crab and multiple, free-flowing cocktail bars.
Parker, who was famously portrayed by Timberlake as the hard-partying Internet entrepreneur in the Social Network film, gave a short talk on stage alongside Spotify CEO Daniel Ek* to kick things off.
