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The Maturation of the Billionaire Boy-Man

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In recent years, however, a new approach has taken hold. Championed by V.C. firm Andreessen Horowitz, this contrarian philosophy observes that many of the most flourishing and sustainable technology companies have been built by founder CEOs, not outsiders. Microsoft, for example, was for two decades built and run by Bill Gates, another Harvard dropout who knew nothing about management when he started. Bezos had been an investment banker before he launched Amazon in his garage. Oracle is still run by its co-founder, Larry Ellison. And Google’s CEO is, once again, co-founder Larry Page.

Many companies that have dumped their founders and gone the professional CEO route, meanwhile, have eventually lost their way: Yahoo, for example, has imploded, and Microsoft has struggled since Gates handed off the company to current CEO Steve Ballmer. And then, of course, there’s Apple, which in 1983 recruited the head of Pepsi, John Sculley, to take over, believing that young product visionary Steve Jobs wasn’t cut out to steer the company. You know how that turned out.

In industries in which products don’t change much—paint, bricks, chemicals—professional CEOs thrive. Companies in these industries don’t rise and fall on innovation—they depend on optimization. (Think Coke, which has been selling the same core product for 126 years.) The tech industry works differently. “The nature of technology,” Marc Andreessen, the Netscape co-founder who is one of Andreesen Horowitz’s chief partners (and, full disclosure, is also an investor in my website Business Insider*), said at a conference recently, “is that the product is always changing. It’s just so rare that you’ll have the same product in five years.” Apple’s recent renaissance began in 2001, with the launch of the iPod. A decade later, the iPod is obsolete, and a staggering two-thirds of Apple’s revenue now comes from products it has invented since 2007.

“If you put a sales guy in charge of the company,” Andreessen continued, “they’ll optimize for the next quarter. Finance guys will optimize the financials.” The company’s founder will optimize the products—and will often have the vision necessary to drive the company’s future innovation. As for the nuts-and-bolts skills necessary to lead a company, those can be learned.

The first thing a leader needs to learn to do is communicate—tell his team where they’re going and why. This is especially true when dozens of employees are being hired monthly, each with his own ideas about how to do things and what’s best for the company. After Zuckerberg stopped coding at Facebook, though, he didn’t communicate—he disappeared. He did so because he hadn’t yet learned another critical leadership skill: the art of saying “no.”

Having missed out on buying MySpace, Viacom was desperate to buy Facebook. Because Viacom was interested, so was Time Warner. So were Google, Yahoo, and Microsoft. Zuckerberg had told his employees he didn’t want to sell. But he didn’t tell that to Facebook’s suitors, at least not directly enough. In one classic example reported by David Kirkpatrick in The Facebook Effect, Viacom’s lead negotiator, MTV president Michael Wolf, told Zuckerberg that he would be in San Francisco in mid-­December and offered him a ride back to New York for the holidays. Zuckerberg accepted the favor. Then, because Wolf actually hadn’t been planning to be in San Francisco and Viacom’s planes were booked, he chartered a jet and flew out to the West Coast to pick up his quarry.

While Zuckerberg was getting schmoozed, morale at Facebook deteriorated. Employees began grumbling about the need for a professional CEO. Things got so bad, Kirkpatrick reports, that one of Zuckerberg’s senior executives confronted him at 2:30 in the morning in a diner—the only face time she could get. If Zuckerberg wanted to run the company, the executive told him, he needed “CEO lessons.”

One quirk of Mark Zuckerberg that frustrates colleagues is that he often doesn’t appear to be listening to them. But he is. A week after the diner intervention, Zuckerberg held his first “all hands” meeting. He held more one-on-one meetings with members of his senior team and scheduled an executive retreat. He got better at explaining priorities.

These efforts helped, but they weren’t enough to stop tech pundits from howling that Facebook needed to put a grown-up in charge. So Zuckerberg sought more counsel, cultivating a who’s who of advisers, including Jobs, Andreessen (now a Facebook board member), Don Graham of the Washington Post, LinkedIn’s Reid Hoffman, Accel Partner’s Jim Breyer, and Peter Thiel, an iconoclastic investor and entrepreneur who was Facebook’s first professional funder. “He’s a sponge,” one Valley veteran says. “He’s always asking questions. ‘What do you think about this? What do you know about that? Who’s good at that?’ ”

Two years ago, at the All Things D technology conference, Zuckerberg participated in a live interview. He walked onstage in his typical attire: blue jeans, T-shirt, and hoodie. But it was hot under the lights. As his interrogators, Walt Mossberg and Kara Swisher of The Wall Street Journal, jumped right in with the touchiest line of questions—about Facebook’s incursions on its users’ privacy—he began to sweat. That night, all anyone could talk about was how anxious and nervous Zuckerberg had looked.


*This article has been updated to reflect that Marc Andreessen is an investor in writer Henry Blodget’s website Business Insider.


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