Tuesday, January 31, 2012

Facebook’s IPO pokes back

This week’s sign the apocalypse is near comes from the front page of the business/tech section and not from the usual suspect, the news section. Well, unless you live in Silicon Valley, then it’s often both, as is in this particular case. You see, Facebook’s inevitable IPO is quickly approaching, and many onlookers see it as the first volley in a whole new tech bubble. The tech community hasn’t had its collective panties in this much of a bunch since 1999.

While numbers are difficult to project in this “quiet period” in front of the stock offering, strong buzz on the street says we can expect $10 billion to be instantly raised, bringing the total valuation of the company to about $100 billion.

$100 billion.

That’s a lot of acres in Farmville, pokes to old high school friends, and status updates ranging from boring to boorish.

Facebook’s celebrity entrepreneur Mark Zuckerberg has been hesitant to go public in the past, and for pretty good reason. First, who wants to invite the scrutiny of Wall Street and its expectations? Moreover, who wants to share so much money when it could be all mine, mine, all mine (insert maniacal, evil laugh here)?

Of course, employees what some of those riches too, and speculation abounds as to that being the root of this week’s activities, and for good reason. When Facebook stock starts trading publically, fully one-third of Facebook’s 3,000 employees stand to become instant millionaires. At the same time, we’ll see a double-digit increase in number of the world’s billionaires.

Millionaires and billionaires, $10 billion and $100 billion. Before long, we start talking about some real money, huh?

Who knows what happens to the stock after it goes public. It will certainly be interesting to see its revenue streams fully disclosed, as well as its sure-to-be-staggering profitability. Who’s to say it’s not a $100 billion dollar company. But, what does that mean, anyway.

As a comparison, as of today the top of the corporate valuation mountain sees Apple and its market capitalization of $425 billion, with Exxon Mobil trailing along with a paltry $401 billion (note: market capitalization is simply the number of shares outstanding multiplied by the share price, and is a true representation of a company’s valuation, or worth). What’s notable is that both Apple and Exxon make something tangible and have lots of assets. Exxon alone carries almost $200 billion in Property, Plant, and Equipment on its Balance Sheet.

Compare that to Facebook, already 1/4th the size of the biggest of corporate titans. From outside, looking in, what exactly is it? 3,000 employees sitting at 3,000 desks, with a piece of real estate in cyberspace that is exactly like everyone else’s piece of cyberspace real estate, only much more visited. More visited to the tune of 800 million active users, with over 400 million of those hitting the site every single day, sharing 900 million objects that other Facebook users interact with.

Damn! And I thought the dollar amounts were big.

So, that’s what it has become. Our Facebook addiction has really grown into quite the beast, as well as a monkey on some of our backs. It’s not just a time-suck that destroys our relationships with the real people who live and work with us every day while we superficially keep up with the “friends” we haven’t actually seen or spoken to in decades, it’s actually the fuel that drives the engine that is destined very soon to be one of the most valuable companies on Earth.

It’s enough to make one stop playing Mafia Wars just long enough to ponder the next technology apple that will be piled on the technology apple cart, for that’s just what we do – pile on the apple cart. Soon, very soon, the valley will be rife once again with unshaven, T-shirt and jeans clad techies and entrepreneurs, all riding Razors and Segways to work, raising money on the shakiest of business plans - and sometimes just a catchy name, logo, or mascot - pandering to the get-really-rich dreams of the American and international venture capitalist.

Don’t believe me?

Three words.

Pets. Dot. Com.

Like we didn’t see that one spiraling down the toilet from day one. Well, I mean we would have if we had bothered to think about the folly of buying heavy bags of dog food and having it shipped to us instead of just stopping by the store and buying it cheaper and taking it home that same day, when our dog was hungry.

Facebook is truly an international cultural phenomenon and a true Americana example of entrepreneurism and risk taking, and who am I to begrudge that, even if I am just a wee bit jealous and can’t help but think, “Why didn’t I think of it, and why didn’t I think of it first, and if I did think of it first, why didn’t I do something about it?” No doubt, it’s here to stay, and stay in a big, big way.

But, what of the pretenders that follow, the other apples on the apple cart? One thing history illustrates is that apples tumble from upended apple carts, and they not always Apple, if you know what I mean. Do you have your shrewd investing eye, and wallet, on technology stocks? While there can be more than one, there usually is only a select few. Buyer beware the rest, particularly those not in first, for eventually someone holds the Pets.com bag and it’s filled with you-know-what.

Of course, I guess I could be wrong, as it’s just this guy’s opinion.

If you can’t find me on Facebook, hit me on Twitter @RayHartjen.

Saturday, January 28, 2012

A Fair Shot Heard ‘Round the World

State of the Union addresses have never been my thing, from the artificial standing ovation that eventually spreads to both sides of the aisle to the shameless, pompous politicking of not only the President, but of the many after speech commentaries provided by politicians for and against, as well as the almost infinite number of TV talking heads that think they’re smarter than us. Keith Olbermann or Bill O’Reilly, anyone? Child, please.

As a kid, I used to tell my parents that if a network had the stones to put entertainment programming on against the State of the Union, they would kill in the ratings. Sure, such a move would severely hamper the reputation of a network’s news division, but since when does the news pay the bills at a network?

President Obama’s address on Tuesday night didn’t disappoint my low expectations. He certainly got my attention, although perhaps not in the manner that his team of speech writers might have intended. “We can restore an economy where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same set of rules.”

Cue record scratching.

What was that? (Hit rewind on DVR)

Fair shot?

Have we collectively sunk so low as to where we’re bemoaning needing a “fair shot?” Seriously, since when do Americans sit back and cry about wanting a fair shot? This country was built by people who proactively took the shots and called the shots. That’s why most of us moved here, and more of us do every single day.

Our American heroes, both real and fictionalized, are ones who overcame seemingly insurmountable obstacles and persevered, fighting through, and eventually accomplishing goals and fulfilling dreams. From Walter Mitty to John Wayne, from Henry Ford to Warren Buffet, from Famous Amos to maybe you, we’re a country about go-getters and action, accountability and responsibility. For the love of God, we didn’t collectively sit through six Sylvester Stallone portraits of Rocky for nothing, did we?

Now, this isn’t a Republican versus Democratic in an election year rant, although full disclosure will have me tell you I didn’t vote for our current president last time around. Full disclosure will also suggest that doesn’t mean I won’t vote for him this time around, for there’s ample time to decide who’s best prepared to lead our country to where it needs to go, and at this point in time I am very open minded and undecided. But, this I’m certain of: we don’t need any talk about “fair shots.”

You get no more fair shot in this world than in America. If you don’t believe it, get yourself some luggage, perhaps a U-Haul or something, and get out and try it someplace else. Just do yourself the favor of not burning your bridges, because you most likely will be coming back.
America has been, and continues to be, the land of opportunity. Only, there is one requirement to seize upon all the potential out there waiting for you. It’s simple. Go grab it. Get off your lazy, pampered, self-entitled ass and work hard.

Sorry to break it to you, but Andy Warhol was wrong. Everyone is not going to be famous for fifteen minutes. You won’t have a camera crew follow you around like you’re a second-coming of the Kardashians. You won’t answer the door one day and open it to a letter informing you that you just inherited $100 million from a long-lost relative.

Success is predicated on smart, hard work. Now, “occupying” some place is certainly hard work – who wants to live in a cardboard box in the middle of winter, relieving yourself in the bushes, and searching daily for an AC outlet? But, it’s not smart. Instead of using your iPad - poor, pitiful, hopeless disenchanted 99%-er, with your glorified toys and 4G necessity of a phone – to poke your network of not-so-friendly friends into joining a pointless protest, how about using it to network for a … wait for it … a job? One that pays you for your work. Use those same skills of organization and communication and put them to work in a productive manner.

Making your own shot, calling your own shots, and making success happen will allow you to one day pay taxes to accommodate the next generation of even more self-righteous, self-entitled knuckleheads who embark on costly protests of the mean, hard, un-fair life of Americans.

President Obama, if you want to earn my vote, you need to change your messaging, and actually just slightly. I don’t want to give anyone a “fair shot,” for I don’t want to further a habit of giving. Give a knucklehead a fish, feed the knucklehead for a day; teach the knucklehead to fish, feed the knucklehead for a lifetime. Forget talk about giving a “fair shot.” Rather, let’s equip our citizens with the tools and go-get-‘em attitude to take advantage of the plentiful shots, opportunities, that are so readily available, there for the taking save for a little work ethic and determination.

And for those you waiting for your “fair shot,” please, grow up and take a little responsibility. Don’t be afraid to scrap your knuckles and strain your back. Go find your passion, reach your potential, and live your life. It’s not going to be given to you by a benevolent, paternalistic government. Rather, it’s already there, like a buried treasure. It’s up to you to pick up the shovel and find it.

I’m waiting to take you best shot on Twitter @RayHartjen