1000Memories, Accel Partners, Amish Jani, Andrew Hyde, Andrew Mason, Andy Sack, Ashton Kutcher, Aydin Senkut, Ben Silverman, Bin 38, Bob Davis, Bob Iger, Brad Feld, Brian Kempner, Chris Hughes, Christopher Steiner, Dan Nova, Daniel Gaisin, Danielle Hootnick, Dave McClure, David Brown, David Cohen, David Kirkpatrick, Demi Moore, Demo Day, Diego Gutierrez, Dustin Moskovitz, Edmond Yue, Eduardo Saverin, Emmett Shear, Eric Lefkofsky, Fergal Mullen, FirstMark Capital, Founders At Work, Francis Duong, Gaurav Tewari, Gerald Levin, Gerald Poch, Greg McAdoo, Greylock Partners, Harjeet Taggar, HBO, Highland Capital Partners, Irena Goldenberg, Jared Polis, Jeff Bewkes, Jeff Weiner, Jeff Zucker, Jessica Livingston, Jessica Mah, Jill Kennedy, Joanna Shields, John Hsin, John Palfrey, Jon Miller, Jr., Justin Kan, Justin.tv, Khan Manka, Larry Wilson, Laurence Albukerk, Lawrence Lenihan, Li Ka-shing, Loopt, Manish Patel, Manka Bros., Mark Cuban, Mark Zuckerberg, Matt Cohler, Matt Nichols, Michael Arrington, Michael Gaiss, MySpace, Nick Marsh, Nicolas Carlson, OnMedea, Owen Van Natta, Paul Buchheit, Paul Cianciolo, Paul Graham, Peter Bell, Peter Thiel, Reddit, Richard de Silva, Richard Heitzman, Rick Heitzmann, Robert Morris, Ron Conway, Rudy Adler, Rupert Murdoch, Sand Hill Road, Scott Shane, Scott Switzer, Sequoia Capital, Sergey Nazarov, Shabbir Dahod, Shawn Broderick, Sheryl Sandberg, Sterling Phillips, Sumner Redstone, Tapzilla, TechCrunch, TechStars, TextPayMe, Toy Story 3, Trevor Blackwell, Y Combinator, google, Eric Schmidt, Tina Brown, The Daily Beast, Barry Diller, Dan Lyons, Google Smear campaign, Burson-Marsteller, Chris Soghoian, Jim Goldman, John Mercurio, Mark Pincus, Zynga, Spotify

Facebook And The Disappearing Valuation (A Fairy Tale)

1000Memories, Accel Partners, Amish Jani, Andrew Hyde, Andrew Mason, Andy Sack, Ashton Kutcher, Aydin Senkut, Ben Silverman, Bin 38, Bob Davis, Bob Iger, Brad Feld, Brian Kempner, Chris Hughes, Christopher Steiner, Dan Nova, Daniel Gaisin, Danielle Hootnick, Dave McClure, David Brown, David Cohen, David Kirkpatrick, Demi Moore, Demo Day, Diego Gutierrez, Dustin Moskovitz, Edmond Yue, Eduardo Saverin, Emmett Shear, Eric Lefkofsky, Fergal Mullen, FirstMark Capital, Founders At Work, Francis Duong, Gaurav Tewari, Gerald Levin, Gerald Poch, Greg McAdoo, Greylock Partners, Harjeet Taggar, HBO, Highland Capital Partners, Irena Goldenberg, Jared Polis, Jeff Bewkes, Jeff Weiner, Jeff Zucker, Jessica Livingston, Jessica Mah, Jill Kennedy, Joanna Shields, John Hsin, John Palfrey, Jon Miller, Jr., Justin Kan, Justin.tv, Khan Manka, Larry Wilson, Laurence Albukerk, Lawrence Lenihan, Li Ka-shing, Loopt, Manish Patel, Manka Bros., Mark Cuban, Mark Zuckerberg, Matt Cohler, Matt Nichols, Michael Arrington, Michael Gaiss, MySpace, Nick Marsh, Nicolas Carlson, OnMedea, Owen Van Natta, Paul Buchheit, Paul Cianciolo, Paul Graham, Peter Bell, Peter Thiel, Reddit, Richard de Silva, Richard Heitzman, Rick Heitzmann, Robert Morris, Ron Conway, Rudy Adler, Rupert Murdoch, Sand Hill Road, Scott Shane, Scott Switzer, Sequoia Capital, Sergey Nazarov, Shabbir Dahod, Shawn Broderick, Sheryl Sandberg, Sterling Phillips, Sumner Redstone, Tapzilla, TechCrunch, TechStars, TextPayMe, Toy Story 3, Trevor Blackwell, Y Combinator, google, Eric Schmidt, Tina Brown, The Daily Beast, Barry Diller, Dan Lyons, Google Smear campaign, Burson-Marsteller, Chris Soghoian, Jim Goldman, John Mercurio, Mark Pincus, Zynga, SpotifyOnce upon a time, in the tiny hamlet of Menlo Park, California, there was a company called Facebook.

This company was unlike any other  (sorry, make that ‘like MANY others’) in that it connected people from around world through a magical and glorious technical achievement called the Internet.

Everyone loved Facebook:

“Oh my God, it is so easy to upload pictures of my baby!”

“I can’t believe I found all my old high school and college friends so easily!”

“Hey everyone, I’m off to get a coffee – can’t start my day without coffee!”

People from around the world chatted, and shared, and reconnected.  There was something really exciting going on in the tiny hamlet of Menlo Park.

But then, one day, because Facebook was growing so so so very large – and its bills were growing so so so much – it needed to somehow make money.

Facebook was so kind that they didn’t want to charge people for the privilege of using its service – so it added advertising.  Advertising so tiny that the people of the world didn’t even noticed the ads were there.

“There are ads on Facebook?  You know, I’ve never seen one – and I certainly have never clicked on one!  Good for them.”

Perhaps Mean Old Mr. Advertiser started to realize that no one was clicking or even noticing his ads.

But little Facebook still needed to get paid – I mean, even a whore has to eat – so they decided to work something out with Mean Old Mr. Advertiser.

1000Memories, Accel Partners, Amish Jani, Andrew Hyde, Andrew Mason, Andy Sack, Ashton Kutcher, Aydin Senkut, Ben Silverman, Bin 38, Bob Davis, Bob Iger, Brad Feld, Brian Kempner, Chris Hughes, Christopher Steiner, Dan Nova, Daniel Gaisin, Danielle Hootnick, Dave McClure, David Brown, David Cohen, David Kirkpatrick, Demi Moore, Demo Day, Diego Gutierrez, Dustin Moskovitz, Edmond Yue, Eduardo Saverin, Emmett Shear, Eric Lefkofsky, Fergal Mullen, FirstMark Capital, Founders At Work, Francis Duong, Gaurav Tewari, Gerald Levin, Gerald Poch, Greg McAdoo, Greylock Partners, Harjeet Taggar, HBO, Highland Capital Partners, Irena Goldenberg, Jared Polis, Jeff Bewkes, Jeff Weiner, Jeff Zucker, Jessica Livingston, Jessica Mah, Jill Kennedy, Joanna Shields, John Hsin, John Palfrey, Jon Miller, Jr., Justin Kan, Justin.tv, Khan Manka, Larry Wilson, Laurence Albukerk, Lawrence Lenihan, Li Ka-shing, Loopt, Manish Patel, Manka Bros., Mark Cuban, Mark Zuckerberg, Matt Cohler, Matt Nichols, Michael Arrington, Michael Gaiss, MySpace, Nick Marsh, Nicolas Carlson, OnMedea, Owen Van Natta, Paul Buchheit, Paul Cianciolo, Paul Graham, Peter Bell, Peter Thiel, Reddit, Richard de Silva, Richard Heitzman, Rick Heitzmann, Robert Morris, Ron Conway, Rudy Adler, Rupert Murdoch, Sand Hill Road, Scott Shane, Scott Switzer, Sequoia Capital, Sergey Nazarov, Shabbir Dahod, Shawn Broderick, Sheryl Sandberg, Sterling Phillips, Sumner Redstone, Tapzilla, TechCrunch, TechStars, TextPayMe, Toy Story 3, Trevor Blackwell, Y Combinator, google, Eric Schmidt, Tina Brown, The Daily Beast, Barry Diller, Dan Lyons, Google Smear campaign, Burson-Marsteller, Chris Soghoian, Jim Goldman, John Mercurio, Mark Pincus, Zynga, SpotifyMaybe they could somehow leverage their size and sell the personal information of their 900 million users.  Would that keep Mean Old Mr. Advertiser off their backs so they could resume their happy life of connecting the world and bringing nothing but joy?

Facebook was so kind to its users that they even added a “Like” button (because “Like” is much nicer than “Dislike” and Coca-Cola doesn’t want to see how many people “Dislike” Coke Zero).

It was so simple, users could either “Like” something or choose not to hit the “Like” button.  It was up to the user.

That worked for awhile until the users of the world started to realize what was happening.  Many users got angry and felt their privacy was being invaded.

About 15 people actually quit Facebook (while another 100 million signed up).

After a few months, things calmed in the tiny hamlet of Menlo Park and the people on Facebook – to a lesser degree – felt fairly happy again.

But then, one day, Facebook decided that the users of the world needed to share every bit of information about their lives – from birth to even death – and put it all into a very conforming and dizzying glop of data called Timeline.

Mean Old Mr. Advertiser LOVED the idea of Timeline.

Finally, Facebook was thinking like him.  Now they got the idea.  Mean Old Mr. Advertiser could scour the lives of the people of the world and target them with goods and services that they may or may not enjoy.

1000Memories, Accel Partners, Amish Jani, Andrew Hyde, Andrew Mason, Andy Sack, Ashton Kutcher, Aydin Senkut, Ben Silverman, Bin 38, Bob Davis, Bob Iger, Brad Feld, Brian Kempner, Chris Hughes, Christopher Steiner, Dan Nova, Daniel Gaisin, Danielle Hootnick, Dave McClure, David Brown, David Cohen, David Kirkpatrick, Demi Moore, Demo Day, Diego Gutierrez, Dustin Moskovitz, Edmond Yue, Eduardo Saverin, Emmett Shear, Eric Lefkofsky, Fergal Mullen, FirstMark Capital, Founders At Work, Francis Duong, Gaurav Tewari, Gerald Levin, Gerald Poch, Greg McAdoo, Greylock Partners, Harjeet Taggar, HBO, Highland Capital Partners, Irena Goldenberg, Jared Polis, Jeff Bewkes, Jeff Weiner, Jeff Zucker, Jessica Livingston, Jessica Mah, Jill Kennedy, Joanna Shields, John Hsin, John Palfrey, Jon Miller, Jr., Justin Kan, Justin.tv, Khan Manka, Larry Wilson, Laurence Albukerk, Lawrence Lenihan, Li Ka-shing, Loopt, Manish Patel, Manka Bros., Mark Cuban, Mark Zuckerberg, Matt Cohler, Matt Nichols, Michael Arrington, Michael Gaiss, MySpace, Nick Marsh, Nicolas Carlson, OnMedea, Owen Van Natta, Paul Buchheit, Paul Cianciolo, Paul Graham, Peter Bell, Peter Thiel, Reddit, Richard de Silva, Richard Heitzman, Rick Heitzmann, Robert Morris, Ron Conway, Rudy Adler, Rupert Murdoch, Sand Hill Road, Scott Shane, Scott Switzer, Sequoia Capital, Sergey Nazarov, Shabbir Dahod, Shawn Broderick, Sheryl Sandberg, Sterling Phillips, Sumner Redstone, Tapzilla, TechCrunch, TechStars, TextPayMe, Toy Story 3, Trevor Blackwell, Y Combinator, google, Eric Schmidt, Tina Brown, The Daily Beast, Barry Diller, Dan Lyons, Google Smear campaign, Burson-Marsteller, Chris Soghoian, Jim Goldman, John Mercurio, Mark Pincus, Zynga, SpotifyAnd somehow, in just a brief eight years of existence – little Facebook grew and grew and grew and became worth $100 BILLION FUCKING DOLLARS!  Oh, goodness, pardon me.  (An IPO last year would been insane!  What a missed opportunity!… but I digress.)

Well, from here the story gets a little tragic.

The beaten down people of the world and users of Facebook grew so exhausted from the daily overhauls of the site (which were necessary to maximize revenue) that they actually stopped spending time on Facebook – instead reading real books to their children and enjoying the outside world.

Comments started to appear on other websites (yes, there are actually other websites) saying they hate Facebook,  are never going back and are quitting.

Poor little Facebook.  They just wanted to HELP the world – not FUCK OVER the world.

How could a crappy redesign and a selling of their soul piss people off so much?

It’s just a website after all (one that is on its way to becoming WORTHLESS and must be STOPPED for the good of the world!… one more digression).

I mean, why do the people of the world care so much?

Well, we all know how the story ends.

Disgruntled engineers (and let’s assume an MBA or two) who helped create the chaos from the direction of Uncle Mark and Aunt Sheryl, began grumbling about their need to become millionaires and billionaires like so many of their friends.

The only way to stop them from leaving the tiny hamlet of Menlo Park – and going to, oh, say, the dangerous crack alleys of Mountain View and Cupertino to seek their fortune – was to take the company public.

1000Memories, Accel Partners, Amish Jani, Andrew Hyde, Andrew Mason, Andy Sack, Ashton Kutcher, Aydin Senkut, Ben Silverman, Bin 38, Bob Davis, Bob Iger, Brad Feld, Brian Kempner, Chris Hughes, Christopher Steiner, Dan Nova, Daniel Gaisin, Danielle Hootnick, Dave McClure, David Brown, David Cohen, David Kirkpatrick, Demi Moore, Demo Day, Diego Gutierrez, Dustin Moskovitz, Edmond Yue, Eduardo Saverin, Emmett Shear, Eric Lefkofsky, Fergal Mullen, FirstMark Capital, Founders At Work, Francis Duong, Gaurav Tewari, Gerald Levin, Gerald Poch, Greg McAdoo, Greylock Partners, Harjeet Taggar, HBO, Highland Capital Partners, Irena Goldenberg, Jared Polis, Jeff Bewkes, Jeff Weiner, Jeff Zucker, Jessica Livingston, Jessica Mah, Jill Kennedy, Joanna Shields, John Hsin, John Palfrey, Jon Miller, Jr., Justin Kan, Justin.tv, Khan Manka, Larry Wilson, Laurence Albukerk, Lawrence Lenihan, Li Ka-shing, Loopt, Manish Patel, Manka Bros., Mark Cuban, Mark Zuckerberg, Matt Cohler, Matt Nichols, Michael Arrington, Michael Gaiss, MySpace, Nick Marsh, Nicolas Carlson, OnMedea, Owen Van Natta, Paul Buchheit, Paul Cianciolo, Paul Graham, Peter Bell, Peter Thiel, Reddit, Richard de Silva, Richard Heitzman, Rick Heitzmann, Robert Morris, Ron Conway, Rudy Adler, Rupert Murdoch, Sand Hill Road, Scott Shane, Scott Switzer, Sequoia Capital, Sergey Nazarov, Shabbir Dahod, Shawn Broderick, Sheryl Sandberg, Sterling Phillips, Sumner Redstone, Tapzilla, TechCrunch, TechStars, TextPayMe, Toy Story 3, Trevor Blackwell, Y Combinator, google, Eric Schmidt, Tina Brown, The Daily Beast, Barry Diller, Dan Lyons, Google Smear campaign, Burson-Marsteller, Chris Soghoian, Jim Goldman, John Mercurio, Mark Pincus, Zynga, SpotifyBy selling $5 or $10 billion dollars in stock to the ‘public’ (at a BULLSHIT valuation of $100 billion!) everyone could become rich and (yes) happy.

So at least the employees of Facebook will now be happy.  The people of the world, who are seriously beginning to hate Facebook and are either leaving or staying away in droves, are less and less happy every day.

But Mean Old Mr. Facebook couldn’t care less – the users can go fuck themselves.

“Just put your freakin’ family photos in the template we have provided, “Like” the new Coke Zero, play the stupid Zynga games, pay for a movie rental, pay for a music subscription, and keep your stupid mouth shut.  We’re not getting to a trillion dollar valuation from pictures of your goddamned baby!”

Mean Old Mr. Facebook is right.  The User is wrong.

The moral of the story:  Don’t screw your users.  They’re the ones that built you up and they’re the ones that will bring you down.

Accel Partners, Ben Silverman, Bob Iger, Chris Hughes, David Kirkpatrick, Dustin Moskovitz, Eduardo Saverin, Gerald Levin, Greylock Partners, HBO, Jeff Bewkes, Jeff Zucker, Jill Kennedy, Joanna Shields, Jon Miller, Khan Manka, Li Ka-shing, Manka Bros., Mark Cuban, Mark Zuckerberg, Matt Cohler, MySpace, Nicolas Carlson, OnMedea, Owen Van Natta, Paul Buchheit, Peter Thiel, Rupert Murdoch, Sheryl Sandberg, Sumner Redstone, Toy Story 3Jill Kennedy – OnMedea

 

 

 

 

 

175 comments

  1. George Parker · January 27, 2012

    Remember when Murdoch paid $600 million for MySpace. Everyone said he was a fucking genius and had stolen it. Then last year he had to dump it for $30 million. Nothing lasts. Remember Second-life, and all the bullshit with Fortune 500 companies opening virtual stores staffed by J-Lo and George Clooney avatars. All bullshit, all gone. Good piece Jill. Dead on.
    Cheers/George “AdScam” Parker

  2. Walter · January 27, 2012

    Hahaha.. Now that’s some good shit!

    Good one Jil…

  3. James · January 27, 2012

    Hi Jill,

    Great article and bang on the money. The sooner these kids and investors realise they have sold their soul and private lives to the devil the better. Maybe we can learn again to value our privacy.

    Keepup the good work

    • Troy the Boy · January 27, 2012

      i couldnt have worded it any different !

  4. hem · January 27, 2012

    I was on FB during the initial period but opted out long ago even before the privacy concerns became an issue because i felt the underlying motto of FB users were:

    ” Pause your sad life and focus on MINE”

    http://www.youtube.com/watch?v=frd6hXF6Idc

  5. BRYAN · January 27, 2012

    I’m sorry, but you are dead wrong and this post is dangerous, as you’re going to look like a fool. FB will be here forever. Jill, if you want me to elaborate, let me know.

    P.S. – I found this article through a FB comment post you made.

    • Jill Kennedy · January 27, 2012

      The post is correct and not dangerous. Facebook is dangerous and must be stopped.

    • KS · January 27, 2012

      Bryan, were you around for the first tech-bubble? You know, the one where dot-com stocks advertised on the Super Bowl, and later imploded to nothing? Check out user stats and see where Facebook is headed.

  6. Jack Hines · January 27, 2012

    I don’t know, Jill. I’m “on” facebook, yet rarely ever actually go there, but I’m quite old. My middle aged kids and their kids still pound away on it. I see that in the few times I visit. ???It’s not going away soon, and many people don’t give a rat’s ass about their own privacy.

  7. Aaron · January 27, 2012

    I think you might be right. I know life is better without Facebook and I plan on keeping it that way, but…
    The internet is becoming more and more homogenized and Facebook seems to be right at the center of this. Instagram and Spotify, as well as plenty of comments sections on websites require a FB account to access. Even without these considerations, people legitimately enjoy FB. It satisfies many social desires instantly and helps people stay connected from very far away. I know we can say the same of other social networking sites that have failed but we should recognize FB is an entirely different beast and it keeps updating and innovating its interface to remain active in people’s lives.
    To say FB is evil is fine. I don’t think it is but whatever, agree to disagree. I think there will be those (including myself) who opt out, but I wouldn’t count on a significant population to do so.
    To say FB will fail is seriously confused. It isn’t difficult to see that FB has real value for businesses and consumers, so until it actually stops benefitting users there is no reason to assume its doom.

    • Aaron · January 27, 2012

      this was in reply to BRYAN by the way…

  8. Innocent Bystander · January 27, 2012

    My first reaction when reading your article “What is she talking about? Is it a real fairy tale or some kind of moral lesson?”

    Then I just checked, and indeed, there is really a website named FaceBook.

  9. Jason S · January 27, 2012

    Stunning news & analysis on Facebook’s new IPO filing amendment tonight:
    http://www.privco.com/breaking-news-facebooks-admits-mobile-shift-damaging-business-faster-than-expected

    Wow, they’re basically warning on their CURRENT QUARTER financials…IN THE MIDDLE OF THEIR OWN IPO ROADSHOW! What a wreck.

    Can’t way you weren’t warned if you subscribe to PrivCo (I do) or IPO specialty sites. Seriously folks, do your homework!

  10. Bobo · January 27, 2012

    Wow, it’s been a long time since I have enjoyed reading an article. This was kick ass and right on. I can’t wait to watch the stock drop after the IPO.

    Cheers!

  11. Tony Selin · January 27, 2012

    They all decided correctly. Time for an IPO is very well chosen.

  12. James Ravazzolo · January 27, 2012

    To say it’s destined to go away is like saying paper and pens are going away. – I don’t think so. The best line (of many) was the “there are ads on Facebook? Good for them!”. I’ve observed (spied on?) many people while on FB and I do believe they are blind to the ads. “We’re on FB to have free fun, not spend money we don’t have because we spend too much time on FB”.

  13. Jamahl Benson · January 27, 2012

    The following site http://www.our-policy.org/ is drawing attention to Facebook’s appalling privacy practices and the changes they are planning to make, and are attempting to get Facebook to acknowledge our privacy rights and making proposals that Facebook should change their policies to get the users of Facebook a fairer deal.

    Please do read the site, and educate yourselves as to what is going on here, and please do join the protest, as this topic is extremely important to all Facebook users.

  14. Real Money · January 27, 2012

    A few things are clear:

    1. The money that the Facebook employees will make post-IPO, from the top to the rank and file will be real, and whether Facebook marches on or goes bust, this money will never have to be returned. The game is over – and they have won. They are all rich. And nothing can now change that fact.

    2. A mediocre head shot is not enough to make this post anything more than the same old song and dance being proliferated across much of the Internet. Yes, get a better head shot.

    3. This article uses such little real data or facts to support its argument that it is now clear to me why Jill is an ex-employee from a now failed bank. I have to assume all her colleagues managed money and risk with equal aplomb. RIP Lehman – nobody misses thee…

  15. el rush limbo · January 27, 2012

    Facebook is the most worthless peace of crapp.. who cares about all your friends from high school, bunch stupid pictures of you vacations, where you are eating, what a wonderful great job you have. I bet most all those people that have any respect are not in FB wasting their time and asking you LIKE OR DISLIKE. and the majority of those people that are in FB are bunch losers UNEMPLOYED or have minimum wages jobs.
    and elementary lids and the majority of those FB peopler are FOREIGNERS. how do I know they are who they are. from south american from asia, from the middle eat and russsia. hope FB become like MYSPACE one day. PLUS employers are checking you out if you want a job or want to keep a job and many people are loosing their jobs.