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$100 Billion In Stock Potential: Facebook’s Staffing Solution
Not a day goes by where I am not amazed by a new software solution that our team helps develop. From on-demand versions of our product to web-based staffing software, each bit and byte of data we work with is dedicated to helping staffing companies fill their client’s needs.
If only I knew it was as simple as offering 1% of a $100 billion stock.
This article from TechCrunch details how Facebook has managed to poach 118 employees and counting from Google. This comes in spite of the fact that, as author Michael Arrington puts it, Google is countering with offers that cannot be refused (think $500,000. Think bonus.)
Facebook, of course, has a simple statement that works in equal measures as both an initial pitch and counter-counter:
‘There’s no reason our stock won’t hit $100 billion in total valuation over the next couple of years. No guarantees, yadda yadda, but hey if you get 1/10 of 1%, that’s $100 million in stock!’
(Editor’s Note: Per the article, up to 80% of Google employees do accept the ‘irrefusable’ counter-offer – and Facebook’s ‘pitch’ is never in writing.)
I am fully aware that money isn’t everything – and by itself – it certainly is not a long term staffing solution.
But I also realize that in a world where all things are equal, and two companies with stellar reputations for employee relations duke it out for equally stellar candidates, generosity from the top can be a key differentiator.
As C. Montgomery Burns, the ‘world’s richest man’ once said – ‘I’d trade it all for a little more.’
Later this month I'll discuss both sides of this issue: whether it’s money or job passion that truly drives employees.
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Comment by Jay Dack on September 30, 2010 at 3:46pm -
Doubtful that .1% equity positions are still in play at this stage of FB's growth.
Doubtful that a potential return on equity is the prime motivation for change for a superior technical talent...instead merely a dissatisfier.
It would be interesting to know what percentage of those that accept counter offers remain in place 6 months after the fact. Industry average says 80% of those that accept, end up leaving after six months.
Social media infrastructure is mostly done...the new frontier for innovation is touch screen devices, local/semantic-based search/recommendations. Trading parking spots from Mtn. View to Palo Alto doesn't represent much in the way of innovation...instead more of an aggregrator play with gravy.
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Comment by Jason Elkin on September 30, 2010 at 4:03pm -
Given Facebook's track record on privacy + Mark Z's own comments on the topic....I can't help but wonder if their internal process for "poaching" these 118 people would pass the ethical smell test.
The equity offer of Facebook to a savvy Google person is a bit like "one in the hand vs. two in the bush." The current valuation of the social experiment is hardly a sure thing when/if they go public.
Given that state of things these days in the web space, your conclusion that .1% equity is all that it takes is a massive assumption. Most Google folks move these days for a litany of reasons. The IPO pot-of-gold is just one factor.
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Comment by David Perry on September 30, 2010 at 11:12pm
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Money can't buy you happiness.
But it can rent a whole lot of fun :-)
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