11 Reasons Why the Obama Presidency is Like Facebook (FB) Failed IPO
Barack Obama and Mark Zuckerberg are iconic personalities who have changed the world. Obama is the first African American to be president of the United States, and Zuckerberg has revolutionized social media with Facebook.
It is not easy to become an icon and retain the designation over time. Some believe these men have made serious errors and their reputations are beginning to fray. Below are 11 problems they share that have markedly impacted their iconic status.
Obama and Zuckerberg are not great leaders. Obama has not been able to develop a working relationship with Congress, and that has caused serious problems for our country. Most every president has had to find ways to deal with the opposition party; Obama has trouble finding common ground with anyone who disagrees with him. It appears that Zuckerberg has not even attempted to establish ties with anyone outside of Facebook, most important would be the investment community. This ill-advised attitude has hurt his company dearly, as the stock price has dropped 50% since the initial public offering.
2. Too Much Hype:
Both men entered the limelight with so much fanfare that it has been impossible for either to live up to advertised expectations.
3. Personal Triumph:
Obama and Zuckerberg’s highest priorities are personal achievement and legacy. Further, each acts as though he has a chip on his shoulder and has something to prove.
4. Debuts Were Flops:
Obama tried his hand at being FDR when he attempted to reform health care. The experiment has been a total flop; it is too costly, provides no reduction in health care costs and will not be available for a few more years, if Congress does not gut it before then. Zuckerberg and his advisors flopped during the days before the IPO. The deal was not priced properly, stock analysts immediately started to question Facebook’s business model and the stock had a disastrous first day. Since then, billions of dollars of value has been frittered away.
5. Millennial Disillusionment:
Obama and Zuckerberg were championed by young people. They were the president's biggest supporters. He was an instant sensation and expectations grew to mythical proportions. Since then, the sensation has become a disappointment. Support of young people in the upcoming elections will be muted. Zuckerberg was every millenial’s hero over the past few years, especially after The Social Network came to the big screen. All the great things accomplished during the past few years at Facebook were squashed when the IPO bombed. Young people are now questioning why they beatified "the Zuck."
6. Not Enough Experience:
Many of the missteps by Obama and Zuckerberg can be attributed to a dearth of experience. One moment Obama was a community organizer, then a senator for two years and then president of the United States. It takes more than IQ and hype to succeed in the White House; President Obama is living proof of this adage. Zuck is not prepared to manage a large public company. He is the mastermind of a great product, but he should hire many more seasoned professionals to manage day-to-day operations.
7. Market Naiveté:
Obama misread the demands of the American people. They wanted jobs; he wanted to build his legacy by reforming one of the largest entitlement institutions in the country. Zuckerberg clearly had no idea how to price an IPO and/or he bullied his bankers into pricing it at a ridiculous price. Result: one of the worst IPOs in history.
8. Communication Blunders:
Barack and Mark were supposed to be communication geniuses. Obama was next great communicator, a la Ronald Reagan. He was a gigantic hit at the 2004 Democratic Convention. Since he became president, Obama's oratory skills and ability to inspire his base have evaporated. Zuckerberg invented a communication company. Over 900 million people communicate via his organization. Why is he unwilling or unable to communicate with the investment community?
9. Taking Credit for the Efforts of Others:
Obama is recognized as the world leader who took out Osama bin Laden. His decision to move forward with the mission was ballsy and admirable. However, the intelligence gathered for many years and the picture perfect execution by American soldiers was minimized. Zuckerberg still believes he is the man. Facebook will never be a great company until he recognizes that a team is necessary to achieve great success in business. He is the mastermind, but he needs quality people, who must be rewarded monetarily and recognized for their efforts.
10. The Hard Sell:
Barack Obama sold a bill of goods to moderates and independents in 2004. It is universally recognized that politicians campaign to the base of the party in the primaries and then move to the center in the general election. The president has taken this concept to a new level. He is a hard core liberal; he should admit it and not try to trick the voters or the opposition party. Zuckerberg has been selling hard during the entire tenure of his relatively short business career. It all came crashing down when he went for the gold and an unsustainable stock price. The billions lost by investors is not something that they will forget.
11. Discontent Among Insiders:
Obama has lost more than his share of insiders during the first four years of his administration. Included in the group are Rahm Emanuel, Emanuel Jones, Steve Rattner, Peter Orzag, Herb Allison and Larry Summers. All of these people held important positions and were probably perturbed that Obama was not implementing things they supported. Zuckerberg is facing a different kind of discontent that is still running its course. His insiders are going to be selling Facebook shares by the millions. Many have worked for a number of years and want to cash out before the stock tanks any further. This phenomenon will put even more pressure on the stock.