Posted by: Rob Hof on November 6, 2008
Mark Zuckerberg, the still impossibly young CEO of social network phenom Facebook, is onstage at the Web 2.0 Summit in San Francisco, interviewed by conference leader John Battelle. Here’s what he has to say (keep refreshing). (As he talks, he sounds a lot more voluble than I’ve heard him before. Maybe he’s getting more comfortable in public speaking):
OMG—he’s not wearing sandals. He’s wearing tennis shoes.
Q: How’d the financing go?
Mark: I wish I could say the same thing I did last year (when Microsoft’s investment and ad deal was about to close). Says they’re thinking about taking more money, as rumored, but doesn’t divulge whether or when.
Q: Do you need money?
Q: Do you need to worry more about making money now?
Mark: 2008 has been a year when we’ve mostly focused on growing the user base. Now 125 million users, from 50 million at the start of the year. Now they’re trying to go international more. That’s been by far the primary focus this year.
We’re not as focused on optimizing revenue. Some people take that to mean we don’t have a revenue strategy. That’s completely wrong. Direct ad sales doing well. Also self-service to reach targeted customers.
Won’t get into specific numbers on which of those is bigger or growing faster. Hundreds of millions of revenues overall.
Q: How big is the Microsoft part?
Mark: Early on it was a bigger portion. It’s a much smaller part of the revenue than either of the other two pieces.
Q: Do you think Microsoft is happy with the price it paid for the stake in Facebook ($240 million for a 2.5% stake, valuing Facebook at $15 billion)?
Mark: The deal was about more than the investment. We’re both pretty happy with the rate at which we’re experimenting with different things.
More after the jump…
Q: How are you going to fulfill that market value?
Mark: I don't think the money necessarily determines the company strategy. We aren't planning to go public for several years. That's pretty much decided for us by the economy. We don't feel a lot of pressure to live up to $15 billion.
Q: How many people work at Facebook?
Mark: A bit more than 700 at this point.
Q: What are the plans this year? Do you have a hiring freeze now?
Mark: No. Key emphasis is just hiring really great technical people.
Q: How do you respond to the criticism that Facebook is a walled garden, not joining OpenSocial, etc.?
Mark: We've taken really big steps on opening up the industry (the open applications platform that debuted last year). Other companies are much smaller than Facebook. Over time, he could see developers settling on OpenSocial, or Facebook could "become the open solution."
As time goes on, people share more and more information. As time goes one, we'll see a natural fanning out and decentralization of things (people's information).
Q: The platform has not lived up to all of its potential--there isn't a very robust neck and shoulders below the head. Is Facebook Connect an attempt to fix that?
Mark: That and other things, he says. He talks about changing incentives for developers to create active engagement and sharing, vs. previous viral adding of apps that then never get used.
Frankly, a lot of applications were just being used to get boxes into people's profiles, vs. encouraging social engagement.
Facebook Connect: People can now use their Facebook identity and connections and content to any other site. It's inherently making a site social to plug into Facebook Connect.
Q: How do you and your partners make money from Facebook Connect?
Mark: Nothing directly so far.
Q: Is Twitter just a feature of Facebook?
Mark: I'm really pretty impressed with it. Won't answer the question directly, though.
Q: Engagement ads: What's the model and who are advertisers drawn to this?
Mark: It's really early. In second iteration now. Ads on home page have something built in to have people share and pass things along. Advertising on the Web is less about hitting someone with a message and more allowing a two-way or a multi-way dialogue.
Q: What do you think about Facebook being banned in the enterprise? And other services that are like Facebook but internal to a company?
Mark: We've actually seen anecdotally trends in the other direction. A lot of people at those companies are making it so people can use Facebook but can't use anything that's direct communication (with outsiders).
Q: Something about competition with OpenSocial, I think, missed most of it...
Mark: Over time, we definitely see this very clear trend of people sharing information more and more broadly. We'll just have to see how it plays out.
Now, questions from the audience:
Q: Do you have a plan for retention of members?
Mark: Around 50% of the users are active every day. We don't do anything specifically to get people back to the site. Just focus on building stuff that makes it easy to share information.
Last Q: How do we keep communities intact on Facebook when they're around issues like Prop. 8 in California that are no longer current?
Mark: Not much of an answer I can divine.
That's a wrap. I didn't hear much big news here, but always interesting to get an update direct from the top dog.