Facebook Almost Sold to Yahoo Because Its Leaders Wanted Different Things
Zuckerberg wanted to connect the world online, his executives wanted to get rich, and the fight led Meta to replace its leadership.
The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch · 20Growth: Meta CMO Alex Schultz on How All Founders Have to Change Their Marketing Playbook in a World of AI | Is AI Plateauing, What it Means if China Wins the AI Race and Why Zuck is a Generational LeaderMark Zuckerberg wanted to keep Facebook independent. A lot of his executives wanted to sell the company to Yahoo, cash out of the startup, and become millionaires.
The account comes from Alex Schultz, Meta's chief marketing officer, who joined after the fight and describes it as a lesson in direction. For Zuckerberg, Schultz says, the aim was to connect the world online and make the world a better place. For many of the executives, the aim was to make the company big enough to exit.
Schultz says a North Star "is not a metric." It is the company's core goal, the thing it is trying to achieve. The metric only tries to describe that goal, and it never describes it perfectly. This fight over Yahoo shows what happens when leaders do not share one.
The executives argued for selling to Yahoo, and Zuckerberg argued for staying independent. After the fight, Meta replaced its senior leadership, and out of that fire the company reached much more clarity about its central goal.
With that clearer shared goal, Schultz says, people who came to work there understood what they were committing to when they joined. When he joined Meta, Schultz says that goal was stated plainly as "connect the world online, full stop."
Is a North Star fluff for startups without a working product? Schultz says "Setting a North Star is critical" before the product has found its users, with the metric used only to describe the goal as best it can.
Questions people ask
Did Yahoo really try to buy Facebook?
Yes. In 2006, Yahoo offered around $1 billion to buy Facebook when the social network was two years old and still focused on college users. Zuckerberg rejected the offer and kept building the company independently.
What is the difference between a North Star and a North Star metric?
A North Star is the goal itself, like connecting the world online, while the metric is the number used to track progress toward it. Schultz warns that no number captures a goal perfectly, so leaders should choose the goal first and treat the number as an approximation.
Did any of the executives who wanted to sell stay on?
Schultz says Meta turned over the entire executive team after the dispute over the Yahoo sale.