Interesting story in Yahoo! on Facebook not selling. I’ve chronicled Facebook’s reticence to sell quite a bit, read more here.
A lot of people thought that Mark Zuckerberg was crazy for not selling. I thought that Mark was doing the right thing given his personality and how much he would want to shoot himself the next day after he signed the deal. Trust me, when someone puts a lot of cash in front of you, or a pile of stock certificates, you have to understand that with that comes responsibility and expectations. I don’t, for one second, think that there is enough money within Yahoo!’s coffers to make a type like Zuckerberg want to give up his freedom.
Of course, some times it makes more sense to sell. 99% of the flash in the pan companies in 2006 were products or applications that belonged in a greater company. That is by no means a knock against the creators of such products, it’s just stating fact. But if you have an actual business plan that includes a revenue strategy, then by all means don’t sell too soon. The web garners 25% of people’s attention yet marketers spend at most 10% of their budgets online, can you imagine the upside for entrepreneurs and investors who hold out? Apparently, I’m not alone in thinking that.
That does not mean you should never sell. Especially for technology companies who need to be #1 or #2 in their space. For content companies, it’s different, to some extent.
We built our company as a diversified holding company / play on the Web: every type of advertising (search, video, classifieds, display) across all categories (auto, health, finance, travel, etc).
To some, it’s too ambitious, I admit. But the model is there and it boils down to execution. But being at my third startup - first two of which were successful - I have no doubt in my mind that in 1, 3 or 5 years, you have a proxy for the Web economy and one helluva IPO candidate right there.
Yeah, I know, sounds crazy. But so did Mark Z. when he turned down Yahoo!’s billion…
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