Facebook might have a new relationship status with its investors
Did you see The Social Network? Watching it made viewers root for the Winklevosses and cheer for Eduardo Saverin. Mark Zuckerberg came off as a socially inept jerk, greedy and just a little bit pathetic. I bet you a billion dollars of Zuckerberg’s fortune he wishes everybody would just go back to talking about how awesome that movie is.
Facebook has a PR snafu on its hands. First Eduardo Saverin ditched the United States, presumably to avoid taxes on his sizable fortune. US Senators Schumer and Casey have proposed the Ex-Patriot Act to punish him and a list of other tax dodging citizenship renouncers. Both the senators are democrats, and it should be noted that even John Boehner supports this act.
Saverin’s defection has been all but forgotten in the face of the IPO fiasco. Facebook opened with a lot of fanfare and a ton of hype. While it led many to recall the dot com bubble, those concerns didn’t stop the majority of investors from leaping at the chance to buy shares. On the opening day, shares hit a high of $45. Today, they sit at around $30. Mark Zuckerberg and the Facebook board aren’t shocked at the incredible rise and fall of the stock. They expected it, but neglected to share the news with investors at large. They instead chose to divulge their knowledge with a only a few large and powerful investors.
Investor relations is a lucrative and important field within public relations. Those who work in investor relations need a high degree of financial literacy, knowledge of laws and policy, and should excel at communication. Investors can be forgotten in the wake of a billion dollar profit, but without them companies struggle. Investor relations professionals work to inspire and maintain investor confidence, both in the company’s ability to make money and the company’s credibility. Right now, Facebook is 0 for 2.
Facebook has some rough months ahead, given the current climate and the attitudes of the American people and the American investor what they did, while not illegal, was pigheaded. Top executives made an extra billion dollars or so, at the expense of a good relationship with their investors. Facebook should hire a crack team of public relations experts; it has a big fence to mend.
– Mary-Nevaire Marsh