Why Facebook's IPO 'Hiccup' Doesn't Matter
Jeff McMahon, Contributor | Forbes
Howard Tullman, president and CEO of Tribeca Flashpoint Media Arts Academy. (Image credit: Getty Images via @daylife)
The $21 billion slide in Facebook’s value since its IPO last week doesn’t reflect the social media platform’s outlook, according to the CEO of Chicago’s Tribeca Flashpoint Media Arts Academy.
Compared to the internet’s other giant, Google, Facebook has the winning formula for the present and probably the future, said Howard Tullman, president and chief executive officer of the Flashpoint Academy, which he describes as a “two-year, high-end school for digital maniacs.”
“Simply stated, Google is a rear-view mirror. Facebook is a sniper scope,” Tullman told academics and business people gathered at the Northwestern University Kellogg School of Management’s KIN Global conference today.
“And that’s why we’re seeing this enormous shift of display advertising to Facebook that’s in the billions already and accelerating.”
As Hayley Tsukayama wrote Thursday afternoon in the Washington Post, Facebook’s IPO was supposed to be the deal of the year. It was expected to be a boost for the state of California. And it was poised to become the bellwether moment for Web 2.0 companies looking to make it on the stock market.
We all know what happened. Facebook came roaring out of the gate two weeks ago, jumping to $42 per share before taking a deep slide. On Thursday, the stock was trading at new lows, though it recovered slightly to close at $29.63 per share.
But the IPO and subsequent slide matter little in the long run, according to Tullman:
“They’ve had some interesting hiccups with the IPO, and it doesn’t really matter at all,” he said. “Facebook is winning. Why are they winning? Because Google is a system that was built by a bunch of engineers, and it’s algorythmic, and it’s looking backward. Whereas Facebook has the easiest job. Everybody volunteers: here’s who I am, here’s what I want to buy, here’s who I’m connected to, here’s how to influence me.”
“Facebook is winning, and the reason Facebook is winning is that the average American spends more time on Facebook than on just about everything else combined. And if that wasn’t bad enough, we live in a winner-take-all technology world where, as the winner pulls away, people abandon all the add-ons.”
