Facing the Market, by Arthur Tebbel – Pop Art #181 | @MDWorld
May 23, 2012 Arthur Tebbel 3 Comments
Dear Art,
What the hell, man? The initial public offering of stock for my company, Facebook, has been an unmitigated disaster. The stock has been pretty steadily going down and, as of this writing is off about 25% from where it started. This isn’t how these tech IPOs are supposed to go. Even Pets.com had an IPO where the price went higher than the initial offering price and there are probably more people on Facebook right now than were ever on Pets.com in their whole lives. What happened here? Is this an ill omen for my beloved company?
-Mark Zuckerberg, Chairman and CEO, Facebook
Mark,
I think it’s probably a bad policy to use Pets.com as a model for your company. They crashed and burned so badly they had to sell their beloved mascot to an auto-financing company. No matter how badly this stock offering goes I don’t think you’re in danger of having to sell any of your corporate iconography to companies that primarily advertise during daytime court shows. It’s important to look on the bright side of things, you know?
Speaking of bright sides you should probably be pretty happy with things as they are now. You had about as bad a week as anyone could have before an IPO and you still made it through. General Motors announced they were pulling all their advertising from Facebook and it made the front page of the New York Times business section, which I bet any suckers chasing IPOs are reading. GM said they could get better penetration by making a Facebook page for free and then directing users to it through advertising on other mediums. That has to be a disaster for you. One of the biggest companies in America decided the best way to use your service was to not pay you any money. That’s the kind of firm that can start a trend and that’s a terrible trend to start.
That’s not to say there isn’t hope here. For years and years Amazon.com had a stock that was a frequent target of ridicule by those in financial circles. Now it trades over $200/share. They proved that they weren’t a flash in the pan tech company and the rewards were long term. They also put their foot on the throats of their traditional competitors and forced themselves into an unquestioned position of market primacy. Have you considered destroying places where people socialize in the real world? Hire some people to randomly attack bars, restaurants, and public parks. That’ll get your point across. Or just get rid of timeline, that shit is annoying.
JosephW
May 23, 2012 - 4:06 pm
I wouldn’t compare Amazon with Facebook. Amazon actually provides a tangible service: you place an order you pay for said order; in a few short days, you get said order delivered to you. (Truthfully, I’m not sure the exact mechanisms through which Amazon’s able to fulfill the orders, but the company does do it.) Facebook, on the other hand, does no such thing–at least, not directly. You can contact a “friend” and offer to buy something from him, but where’s Facebook’s cut of the sale? Facebook isn’t eBay (at least, not yet) so they haven’t set up a system through which the company can take a piece of the action (and even eBay took a few years before it figured out a more substantial way to get in a piece of the action). I’d bet that if Facebook started monitoring its users’ actions and demanding a percentage of any type of monetary transaction conducted by the users, people would be closing their accounts pretty quickly. There’s already talk that Facebook is planning to charge a fee for its commercial users (folks like GM and Ford and the like) on top of the fees it gets from just the little ads. If the corporate folks have to start paying for THEIR pages while the private users don’t (a model not unlike the telephone book–companies pay for ad space which basically underwrites the free phone books that go to phone company customers), the corporations will probably accept that–but only to a certain degree. If Facebook tries to get too greedy, the corporate folks will pull their pages. And, honestly, if you’re looking for a local restaurant chain location, which is the better source: a Facebook page or a Google search for the company’s website (most of which have “store location” pages)? Personally, I’d go with Google (even if I had a Facebook page).
Vinnie Bartilucci
May 23, 2012 - 8:20 pm
For a solid week beforehand, every talking head on television connected to the stock game (and all that that implies) were saying, “Don’t buy Facebook right away – the employees are going to be cashing out, supply will outstrip demand, the price will drop, wait a while.”
And that’s EXACTLY WHAT HAPPENED. And people paid attention, and didn’t buy.
Now to me, the news item should have been “Stock experts got one right” or “Public follows Stock tipsters; things go their way”. But no, the headlines all read “IS FACEBOOK DOOMED?”
Can’t win for losing, huh?
Mike Gold
May 24, 2012 - 3:10 pm
The punchline of the week?
“Pre-nup.”