Tag Archive: Reid Hoffman


One team is winning and the other is losing.

The respective IPO dates of two rival social media platforms are only separated by one year and one day, but the reception by Wall Street investors could not have been more different.

As a result I completely unfriended Facebook today, selling my remaining shares of “FB,” while maintaining and considering adding to my position in LinkedIn. The LinkedIn connection has been slightly lucrative, thank you very much.

According to the Wall Street analysts, the heavy sell off in Facebook is attributable to the company not presenting a convincing argument during Thursday’s conference call on how it well monetize mobile platforms. Closer to the heart of the matter: Facebook is not providing guidance to investors going forward, making it difficult for buy-and-sell side analysts to build their financial models.

From this humble perspective, it seems something more basic is coming into play: Schadenfreude.

There are a growing number of people, who resent Mark Zuckerberg, his hoodie, the “Social Network” and his billions. Can we simply chalk it all up to old-fashioned jealousy of those who achieve? As the leader of the free world recently said, “You didn’t build that.” Au contraire.

zuckerberghoodie

As many of us know, it all started in Harvard’s Suite H-33, Kirkland House (Isn’t Harvard private? Do the public roads leading up to the campus negate all student and faculty accomplishments?). Zuckerberg is an entrepreneur with a dream that succeeded beyond his fondest dreams as 900 million subscribe to Facebook. And with this success came private equity, in fact too much private equity. Zuckerberg was essentially forced by SEC rules to go public. It may have been the world’s first kicking-and-screaming IPO.

During the investor tour leading up to Facebook’s May 18 (NASDAQ: FB) public offering, there were complaints that Zuckerberg sported his trademark hoodie rather than standard-issue Brooks Brothers suit with the Thomas Pink shirt and cuff links. Has this man no decency?

And just yesterday Maria Bartiromo and the other talking heads on CNBC were conjecturing whether Zuckerberg would even show up for his company’s first-ever investor conference call. Maybe analyst calls are not cool enough for the 29-year-old founder and chief executive of the world’s largest social media platform. Zuckerberg showed up, but the stock still closed today at $23.70, miles below its $38 IPO price. One analyst has set an 18-month $40 price target. I will hold off in placing an order.

Contrast the disastrous performance of the Facebook IPO with a similar public offering a year earlier by LinkedIn. The latter came with virtually no investor frenzy, but the results are impressive.

LinkedIn (NYSE: LNKD) went public on May 19, 2011, debuting at $45, quickly jumping to $85 and closing today at $103.42. Not bad.

One key differentiator between LinkedIn and Facebook is the former is targeted almost exclusively toward business. Need to find a job? Open and populate a LinkedIn profile. Be sure to include the details of your resume (curriculum vitae), your academic background, your recommendations, your PowerPoints, your blog and even your mug shot. This URL is one-stop shopping for recruiters.

linkedin

Want to research a recruiter, a hiring manager, a business partner, a customer, just simply head to the LinkedIn search engine. In a few key strokes, you know where she or he went to college; how long she or he has held the present position and where she or he has been before. This site is a great way to do your homework and to be prepared.

Another key differentiator is your “connections,” their connections and the connections of their connections. Who do you know? How important are your connections? What do your connections say about your readiness for a job, particularly a rain-making position that benefits from a deep roll-a-dex?

Almost DailyBrett opines that “connections” are more important in the eyes of Wall Street than “friends” and “likes.” Sure, Zuckerberg has access to the living patterns of almost one-seventh of the planet and $50 billion in market capitalization. LinkedIn only has a mere 161 million subscribers and only $10 billion in market cap…and yet Wall Street better understands the LinkedIn business model. Facebook in contrast offers friends and FUD (Fear Uncertainty and Doubt).

Most of all there is no uncertainty whether LinkedIn co-founder Reid Hoffman will participate in his company’s conference calls. Thumbs up.

http://finance.yahoo.com/news/does-wall-street-hate-facebook-192938528.html

http://online.wsj.com/article/SB10000872396390443931404577551344018773450.html

“Yeah, just sitting back trying to recapture a little of the glory of, well time slips away and leaves you with nothing mister but boring stories of glory days.” Bruce Springsteen, Glory Days.

glorydays

Remember the PC/Internet connectivity era?

The one that ended about a decade ago?

Remember when investing in Intel (NASDAQ: INTC); Microsoft (NASDAQ: MSFT); Cisco (NASDAQ: CSCO) and Dell (NASDAQ: DELL) was close to automatic profits on Wall Street?

Of course, you wanted to invest in these stocks and so did everyone else…but over time the world changed: Pentium processors became a commodity, just like all other semiconductors.

Microsoft operating system announcements became less-anticipated and the results less than stellar…most of all they were being used for ubiquitous PCs.

Cisco makes switches and routers. They work. The Internet works. Thank you very much…and just this week the company laid off 6,500 workers.

And Dell? Well, Dell produced a great model for inventory…How about big-time results?

If you are engaged in public relations, marketing, employee communications and social media for these four companies, you are probably singing Bruce Springsteen’s “Glory Days,” if you are singing anything at all.

So what is the connection between music and technology public relations?

Two days ago CNBC after-market anchors were hyperventilating about another blow-out quarter for Apple (NASDAQ: AAPL), they really had nothing negative that they could say about the company as the stock reached $400 a share for the first time. Reportedly, the company sold every iPad that it made.

And then one of the talking heads asked the rhetorical question: “What happens when the music stops?”

For companies such as Apple, search engine Google (NASDAQ: GOOG), social media Facebook, cloud computing Salesforce.com (NYSE: CRM) and social media LinkedIn (NYSE: LNKD), it is downright heresy to suggest that the music will stop someday…but based upon history it will because in virtually all cases it has to.

Ten years ago, Apple was trading at $9.07 per share. Today, Apple is listed at $387.90. Anybody remember Gil Amelio? Hint, he was the guy running the show before the resurrection of Steve Jobs. Remember all the hoopla about Blackberry’s and Research in Motion (NASDAQ: RIMM)? The music stopped.

Ten years ago, Google didn’t exist. All the search discussion focused on Yahoo (NASDAQ: YHOO)…but the music stopped for Yahoo as Google went public in 2004 at $101 per share. Today the Google is trading at $606.78: Yahoo at $13.61. And just this month, the company introduced Google+, taking dead aim at its chief competitor, Facebook.

Facebook didn’t exist 10 years ago. Its eventual founder Mark Zuckerberg was a secondary school student attending Phillips Exeter Academy in Massachusetts. He was still a couple of years away from that famous dorm room at Harvard University.

Ten years ago, Salesforce.com was privately held and still going through the growing pains of a two-year old company. The company went public in 2004 at $15 per share. Today Salesforce.com trades on the big board at $149.16.

LinkedIn.com was the first social media company to go public, debuting two months ago at $45 per share and today trading at $101.02 per share. The biggest question is whether the shadow of Facebook will stomp on little ole LinkedIn, if Zuckerberg et al decide to take Facebook public.

The music is playing fast and furious for Apple, Google, Facebook, Salesforce.com and LinkedIn. Times are good. Reporters/editors/analysts/investors can’t get enough of Jobs, Zuckerberg, Larry Page and Sergey Brin of Google and to a lesser extent Marc Benioff of Salesforce.com and Reid Hoffman of LinkedIn.

Now imagine for comparison reasons if you were managing public relations/marketing/employee communications/social media for Intel, Microsoft, Cisco and Dell. These used to be hot jobs; not as much today…Keep in mind that a job is a job in this economy.

Ten years ago, Intel traded at $29.97; today, $22.69.

Microsoft was priced at $33.60; today $27.10.

Cisco was a $20.61 stock 10 years ago; today $16.39.

Dell traded at $27.61 a decade ago; today, $17.46.

dell

Anyone want to hear another story about Moore’s Law? How about the genius of Bill Gates and Paul Allen? Bet ya it’s a whole lot easier to get an interview with John Chambers of Cisco, but does he really want to talk about layoffs? And how many Silicon Valley-based reporters are accumulating frequent flyer miles to spend time with Michael Dell in Austin?

The point of this Almost DailyBrett exercise is to remind PR types that nothing lasts forever. If things are going great, don’t get giddy. If things are heading south, keep your wits about you. And if you have stock options in a high-flying company, start selling in increments as the stock moves upward. There are two kinds of remorse when it comes to options; the one that you sold too early…and then there is the other one.

And never lose hope. Apple was a dead company before Steve Jobs came back. But also don’t be guilty of drinking your own bath water. In most cases as Don McLean once wrote in “American Pie” there comes a day “when the music died.”

DISCLOSURE TIME: The author of Almost DailyBrett presently owns shares of Salesforce.com and LinkedIn. Decisions regarding the impartiality of my rhetorical ramblings are left to the discretion of the reader.

http://www.apple.com/pr/library/2011/07/19Apple-Reports-Third-Quarter-Results.html

http://en.wikipedia.org/wiki/Facebook

http://en.wikipedia.org/wiki/Google

http://en.wikipedia.org/wiki/Salesforce.com

http://en.wikipedia.org/wiki/Linkedin

http://en.wikipedia.org/wiki/Phillips_Exeter_Academy

http://en.wikipedia.org/wiki/Gil_Amelio

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