Meta is under a lot of threats in the current FTC lawsuit against it. In theory, negative judgments can lead to a breakup of the company. But CEO Mark Zuckerberg once faced a greater existential threat. Back in 2006, his investors and even his employees were forcing him to sell his two-year-old startup for quick returns. Facebook remains a university-based social network, and several companies are interested in buying it. The worst offer comes from Yahoo, which offers an amazing $1 billion. Zuckerberg believes he can develop the company into something valuable. The pressure was so great that he blinked once and agreed to the sale in principle. But after that, the decline in Yahoo stock led to then-leader Terry Semel asking for a price adjustment. Zuckerberg seized the opportunity to close the negotiations. Facebook will remain in his hands.
Zuckerberg told me a few years later: “That was the most stressful period of my life.” So, ironically, through the testimony of this trial, he observed how he treated the other two sets of founders in a very similar situation to him, but he managed to buy it out.
The current FTC trial NUB seems to depend on how U.S. District Court Judge James Boasberg will define Meta's market — whether limited to social media or, as Meta argues, the broader field of “entertainment”. But many early testimony shed light on the details of Zuckerberg's successful pursuit of Instagram and WhatsApp – both companies have now become part of Meta's illegal monopoly on social media, according to the government. (The trial also cites the case of Snap, which boycotts Zuckerberg's $6 billion offer, having to deal with Facebook's copying of its products. Aside from legality, the companies were continued by Zuckerberg's offer, which led to a hugely inspiring study of Accakisition Dynamics between small and large businesses in the first few days of the case.
Although almost all of these narratives have been detailed over the years, I have thoroughly documented them in my own 2020 account Facebook: Internal Story– Surprisingly, the principal testified while being sworn in. Hey, my source is good, but I didn't swear!
In their testimony, star witness Zuckerberg and Instagram co-founder Kevin Systrom agreed on the facts, but their explanation was Mars and Venus. In 2012, Instagram was about to end its $500 million investment round when the small company suddenly found itself working and Facebook was in a hot pursuit. In an email at the time, Facebook's chief financial officer asked Zuckerberg that his goal was to “neutralize potential competitors.” The answer is yes. That's not how he casts it on Systrom and co-founder Mike Krieger. Zuckerberg assured the co-founders that they will take control of Instagram and can develop it. They will have the best of both worlds – independence and Facebook’s huge resources. Oh, Facebook’s $1 billion offer is twice the valuation of the company’s soon-to-end funding.
Everything was fine for a few years, but then Zuckerberg began to deny Instagram’s resources, which its co-founder had built into the royal family. Systrom testified that Zuckerberg seemed to envy Instagram’s success and cultural currency, saying his boss “believes that we are hurting Facebook’s growth.” Zuckerberg's snub eventually left the founder of Instagram in 2018. By then, Instagram could be said to be 100 times the purchase price of Zuckerberg. Systrom and Krieger's loot, while large, did not reflect the huge value they built for Facebook.
