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Zuckerberg's CEO skills in doubt

Aug. 17, 2012 at 1:09 PM   |   Comments

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MENLO PARK, Calif., Aug. 17 (UPI) -- Industry analysts have begun to question whether Mark Zuckerberg, the founder of U.S. Internet giant Facebook, is up to the task of running the company.

Zuckerberg founded Facebook while a student at Harvard University and guided it through its initial public offering in May, which valued the company at about $100 billion.

Since then, and even in weeks leading up to the IPO, Facebook has suffered a humiliating series of setbacks that shaved its share value from the original price of $38 per share to about half of that by Thursday, when 271 million locked-up shares became available for sales after an initial moratorium.

Essentially, enthusiastic investors who jumped in to buy a piece of Facebook on Day 1 of its public life have seen their investments shrivel. Thursday's market close saw Facebook priced $19.87 per share.

"There is a growing sense that Mark Zuckerberg, talented though he may be, is in over his hoodie as chief executive officer of a multibillion-dollar public company," said Sam Hamadeh, head of market research firm PrivCo.

"While in many cases a company founder can, and does, grow into the job, things are happening so quickly that there is precious little time here for Zuckerberg to do that," Hamadeh said.

Zuckerberg is known for his entrepreneurial spirit, the good fortune of developing a good idea at the right time and for becoming the world's youngest billionaire. He is 28 years old and earned about $19.1 billion the day his company went public.

But by late July, his personal worth had dropped by $7.2 billion, CNNMoney reported.

Zuckerberg is also known for his sometimes out-of-place devotion to sneakers, blue jeans, T-shirts and a hooded sweatshirt, known as a hoodie, which is his outfit of choice even at important business events.

"This was the most anticipated IPO in many years and it was like an exploding cigar," Barry Ritholtz, head of research firm Fusion IQ, told the Los Angeles Times.

"Every investor thought they were about to become wealthy beyond their wildest dreams, and they had this blow up in their face," he said.

"He's trying to appeal to his audience instead of being responsible to his investors. His job now is to run the company," said Chris Whalen, a senior managing director at Tangent Capital Partners.

© 2012 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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