Mark Zuckerberg, the Warren Buffett of technology?
J Thoendell stashed this in Tech
But note what Zuckerberg doesn’t say, as much as what he does. There’s no mention of “social”, no mention even of “Facebook”. Zuckerberg is one of the greatest product managers in history, but his legendary focus is nowhere to be seen here: it’s all big, vague, hand-waving futurism. And note too one of the quieter members of Zuckerberg’s board of directors: Donald Graham, the CEO of what used to be called the Washington Post Company, and old friend of Warren Buffett.
Buffett, of course, is the classic conglomerator: he’ll buy any business, so long as it’s good. Graham is similar: he inherited a grand media property, and added on all manner of unrelated businesses. Eventually he sold the Washington Post to Jeff Bezos, for $250 million — and is still the CEO of a company, Graham Holdings, which is worth more than $5 billion.
Is it too early to declare that Zuckerberg has ambitions to become the Warren Buffett of technology? Look at his big purchases — Instagram, WhatsApp, Oculus. None of them are likely to be integrated into the core Facebook product any time soon; none of them really make it better in any visible way. I’m sure he promised something similar to Snapchat, too.
Zuckerberg knows how short-lived products can be, on the internet: he knows that if he wants to build a company which will last decades, it’s going to have to outlast Facebook as we currently conceive it. The trick is to use Facebook’s current awesome profitability and size to acquire a portfolio of companies; as one becomes passé, the next will take over. Probably none of them will ever be as big and dominant as Facebook is today, but that’s OK: together, they can be huge.
Facebook is evolving, now that its growth is constrained by the growth of the Internet itself.
Mark Zuckerberg's careful demonstration of Facebook's willingness to let its divisions operate independently really sets it apart from an acquirer like Google, which has only let two divisions operate independently in its 15 year history (YouTube and what was Motorola but is now Nest).
The Instagram founder Kevin helped give Oculus peace of mind that they could operate independently once under the Facebook umbrella. In that sense, Facebook's acquisitions have been a progression.
If Oculus is successful within Facebook, a generation of new technology startups will be more willing to get acquired by Facebook. That really does situate Facebook in a great place for the future.
Facebook' willingness to let its acquired companies stay independent makes it much more likely that companies like Twitter, Snapchat, or Uber would be willing to be acquired if the price were right.