Business Project

Facebook Company Profile

Fardeen Ahmed

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The company I chose to analyze in this project is Facebook. It is an American firm which offers online social networking services to its users globally. It was founded by Mark Zuckerberg, Eduardo Saverin, Dustin Moskovitz, and Chris Hughes while they were students at Harvard University (Brügger 4). The company headquarters are situated in Menlo Park, California. Over the years, Facebook has grown to become the biggest social networking site worldwide with over one billions subscribers across all nations. Mark Zuckerberg who was the key architect was 23 years old when he developed this application while he was studying psychology at Harvard University (Tagg and Philip 350). Since he was a profound computer programming wizard, he had initially developed various networking sites and apps such as Coursematch that allowed users to view students taking similar degrees and Facemash which allowed users to rate other students based on their attractiveness.

Accordingly, the history of Facebook is marred with controversies and complex dynamics. The original idea was Facemash which was developed to allow Harvard students to rate the attractiveness of their classmates (Knautz and Baran 1048). Since the development violated the university policies by accessing student profiles and pictures without their consent, it was shut down two days after its launch and Mark was lucky to avoid suspension from the college. However, it had already gained over 450 subscribers who managed to vote over 20,000 times in that short span which encouraged him to go on with his programming ventures (Castañeda, Markie and Erin 399). It was in 2004 when Zuckerberg first registered thefacebook through http://www.thefacebook.com and later launched it in February the same year. Initially, it allowed Harvard students who subscribed to post their pictures and brief personal profiles about their lives such as classes, share interests, connect and share courses users were undertaking. Users joined using the Harvard email and within a month over 50% of the students had joined (Quesnell 8). Tentatively, the popularity of the app increased exponentially and soon other universities including Yale and Stanford were allowed to join. As a result, by June 2004, over 240,000 students across 30 schools had signed up which attracted the interest of MasterCard which started to pay for its exposure and publicity.

However, the initiative was facing legal suits from other partakers who believed Mark Zuckerberg had stolen their initial idea. Cameron Winklevoss, Tyler Winklevoss, and Divya Narendra had been working with him on a related project and later he quit and started working on an individual project which was related to what the team was undertaking leading to a legal suit against him for recompense. The suit ended up being settled out of court in 2008 with each of the three mates allotted 1.2 million shares in the firm worth $300 million based on IPO trading in that time (Hoffmann, Nicholas, and Michael 205). Settling the suit allowed the company to engage in advancing its products without further disruptions which lead to the addition of the wall to subscriber's profiles which has gone to become a very critical aspect of social networking using the platform. Furthermore, by September 2004, it had reached over 1 million members although Myspace was still ahead of it with over 5 million users at that time (Brügger 8). It became a public traded company in 2012 with its initial public offer raising $16 billion which ended up boosting its market value to $102.4 billion (Knautz and Baran 1049).  It overtook Google Inc., which was holding the record for an internet company IPO trading after it went public and raised $1.9 billion in 2004.

Besides, access to Facebook is free of charge for subscribers but it is able to generate income through advertisements on the platform. It allows new users to join the website, upload pictures, join other groups as well as initiate groups that they can regulate. Besides, it has other components such as a timeline where subscribers can post contents about occurrences in their lives and friends can respond (Rodriguez 12). The status aspect allows the user to update to their social network friends about their location and situations. Again, the news feed allows subscribers to alert friends about changes in their profile pictures and statuses. The site also allows members to chat with each via private messages while at the same time being able to signal their approval of content on the platform through the likes and comment button. Moreover, the beauty about the social networking site is the insistence by the founders on transparency and avoidance of false identity by forbidding such violators (Weedon, Nuland and Stamos 27). It is because the company believed that forming personal relationships, sharing ideas and building long-lasting networks ought to be based on transparency and honesty. The peer to peer connections also facilitates businesses to reach their consumers with relevant products.

Currently, privacy remains the biggest challenge for Facebook. It set in 2006 when the firm introduced the NewsFeed which captured all changes that member's friends lists made on their profiles. After a mass public outcry from the subscribers, it rapidly implemented privacy controls which allow users to regulate what will appear on the NewsFeed (Castañeda, Markie and Erin 400). Despite these controls, privacy in Facebook remains one of the most debated issues in social networking circles due to the recent admissions by the company that data and information about users were accessed by companies for targeted advertising and politicians during campaigns across the globe. It also continues to receive criticisms over the complexity of its privacy policies as well as the constant changes they keep making on them (Castañeda, Markie and Erin 396). Despite these shortcomings, the platform offers a variety of services that are critical to users.

The company has also invested in strategic ventures that are critical to its success. For instance, acquisition of WhatsApp which was announced initially in 2014 and resulted in WhatsApp founders attaching a $16billion price tag on it with $4billion in cash $12billion in Facebook company shares. Conversely, Facebook ended up paying $21.8billion to acquire it which remains one of the most strategic ventures that it has invested over the years (Weedon, Nuland and Stamos 27). It also launched the Marketplace in 2007 which allows business users to post classified products and services to the large networks globally. Besides, it acquired Instagram on April 9, 2012, for over $1 billion for the app with $300 million in cash and the balance in Facebook shares (Hoffmann, Nicholas, and Michael 202). The app had only 30 million subscribers and no revenues during the acquisition.

The company is managed by a board of directors which is led by Mark Zuckerberg who is the founder, Chairman, and CEO. He is responsible for setting the overall direction and strategies for the firm by leading the designing of the company’s services and product development. Besides, Sheryl Sandberg acts as the Chief operating officer tasked with overseeing the company’s day to day business operations (Quesnell 12). She was the vice president of Global Online Sales and Operations at Google before moving to Facebook. She holds an MBA from Harvard Business School. Dave Wehner acts as the Chief finance officer who leads the firm's financial aspects, facilities, and IT teams. He had served Facebook as vice president, Corporate Finance and Business Planning when he joined the company. He holds M.S. in Applied Physics from Stanford University. Besides, Mike Schroepfer serves as that Chief Technology Officer. He is tasked with leading the development of technological strategies and teams that facilitate the firm to connect with over its 1 billion subscribers and work towards improving artificial intelligence aspects of the app (Rodriguez 20). He was the vice president of engineering at Mozilla Corporation before joining Facebook. He holds MSC Computer science from Stanford University. The board of directors is composed of Mark Zuckerberg, Sheryl Sandberg, Marc Andreessen, Kenneth Chenault, Jeffrey Zients, Susan Desmond-Hellmann, Reed Hastings, Peter Thiel, and Erskine Bowles.

Overall, Facebook has ended up becoming a very powerful tool which is able to surpass personal profiles to how businesses can make use of the site as well as political movements. It also allows developers to generate revenues for themselves and for Facebook through virtual and digital products offerings such as games. It also has well laid out leadership structure that facilities creativity and innovations which are the core tenets of the company as it serves both U.S and international clients. Despite all these advances, Facebook ranks lowly among customer satisfaction surveys due to privacy issues. Thus, to be able to gain the trust of subscribers, Facebook has to adopt a less sophisticated privacy policy that will be easy to comprehend for the clients.

Work Cited

Brügger, Niels. "A brief history of Facebook as a media text: The development of an empty structure." First Monday 20.5 (2015).

Castañeda, Araceli M., Markie L. Wendel, and Erin E. Crockett. "Overlap in Facebook profiles reflects relationship closeness." The Journal of social psychology 155.4 (2015): 395-401.

Hoffmann, Anna Lauren, Nicholas Proferes, and Michael Zimmer. "Making the world more open and connected”: Mark Zuckerberg and the discursive construction of Facebook and its users." New Media & Society 20.1 (2018): 199-218.

Knautz, Kathrin, and Baran S. Katsiaryna. Facets of Facebook: use and users. De Gruyter, 2018.

Lincoln, Siân, and Brady Robards. "10 years of Facebook." (2014): 1047-1050.

Quesnell, Andrew. "Facebook: Mark Zuckerberg." (2018).

Rodriguez, Carla. "Beyond the wall: affective extension on Facebook." (2017).

Tagg, Caroline, and Philip Seargeant. "Facebook and the discursive construction of the social network." The Routledge Handbook of Language and Digital Communication, London: Routledge (2016): 339-353.

Weedon, Jen, William Nuland, and Alex Stamos. "Information operations and Facebook." version 1 (2017): 27.