6 Biggest Problems Mark Zuckerberg faced in Early Days of Facebook

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Written by BusinessAlligators Support

Support Staff at BusinessAlligators is a team of business experts led by Shilpi Singh Trusted by over 100K readers worldwide.

April 25, 2016

While I was doing my research upon problems Mark Zuckerberg faced during the early days, I came across a website commenting on him that ‘the guy’ doesn’t care much about making money. It is indeed a stunning remark for someone who made it to the Forbes list seven times since last year. The way in which Mark Zuckerberg operates has been totally different since he has started working. The co-Founder, Chairman and CEO of Facebook, Mark Zuckerberg started it small in 2004 while he was a college student. Little did he know that his idea would reach this level and also he was unaware of the hardship and problems of Business life. He always was into an innovation but making money was never his forte. But as we all know, with great power come greater responsibilities. Mark Zuckerberg’s journey from ‘Facemash’ to ‘Facebook’ has not been entirely smooth. Mark Zuckerberg faced millions of problems during his early days.

Looking at the success of Mark Zuckerberg it is nearly impossible to imagine him having gone through any hardships during his beginning stage of Facebook. But for every entrepreneur facing multiple challenges is inevitable. This is what makes a strong player. The following lists the major problems faced by Mark Zuckerberg in the early days of the launch of Facebook.

1. Dealing with Criticism, Being called a “Toddler CEO”

  • How to face media after the blame of idea theft.
  • What to say about the hidden partners in public.

Talking about CEOs our minds jump to the names of Steve Jobs or Bill Gates. They co-founded their companies at the age of 20. Both were unusual. It was until late that he got real respect and recognition from the world. Even in the beginning phase when Mark Zuckerberg was a college student, he faced a lot of criticism for getting the blame of having stolen the idea of Harvardconnectins.com and building a competing product. The Twins from Mark’s senior year claimed that Mark sabotaged their project and betrayed them. Mark Zuckerberg confronted yet another challenge when Ben Mezrich wrote his far-famed book, ‘The Accidental Billionaires’, was launched in 2009. Mezrich became intensely infamous for his book telling Zuckerberg’s story, obviously with some acumen and garnish on the true one. ‘A writer’s mind is pretty imaginative, you see.’

2. Funding and Investment

  • How to transform Facebook into a Must-Own stock.
  • Finding lead investors for Facebook was a challenge.

One of the biggest problem Mark Zuckerberg faced was how to attract investors and bring money to the company. The problem of funding is one such issue that Mark Zuckerberg overcame by running a few advertisements on its website initially. In 2004 when there wasn’t any outside funding available, Mark put his own money into his business. It was a challenge for Mark Zuckerberg to find potential lead investors and it was required that Facebook must reach 1.5 million users by the end of 2004 in order to get the first angel Investment which they narrowly missed but the loan was still allowed to them. When in 2005 the Accel Partners agreed to make venture capital investment deal with Facebook, they expanded its board to five seats out of which two were still empty and it was on Mark Zuckerberg to nominate anybody for the seats. At the time Microsoft invested in Facebook in 2007, it bought the ‘preferred stock’ and had the ‘liquidation preferences’ over the common stockholders; it was a risk to Facebook if any day Facebook gets sold. It was until later that Zuckerberg filed for an IPO that raised $16 billion making Facebook the third largest in U.S history, but it also required Facebook to add bold revenue streams to justify such big valuation.

3. Mark Zuckerberg needed Critical Mass of Users to be Successful

  • How to create hype among users.
  • Mark wanted to overcome people’s tendency to be lazy.

Critical mass means getting a sufficient number of adopters or long term users of any innovation in the social system in such a manner that the rate of adoption becomes self-sustaining and it leads to further growth. Before the launch of Facebook on the big platform, Mark Zuckerberg knew his start-up would have to face this obstacle which can be resolved only by achieving critical mass. If good ideas would just market themselves then the energy could be solely devoted to making cool things, said Zuckerberg, but this is something which needed to be garnered by efficiency and hard work, in order to survive, which Mark did. Due to critical mass, Facebook will never have to charge people for access to basic tools.

Related- Mark Zuckerberg’s Secrets of Success

4. Decision Making was the toughest part for Mark Zuckerberg

  • What will be the consequences of turning down acquisition offers from every big company?
  • Whom to hire for the most important post of the company, i.e. The COO & CFO.

As the business starts to grow it becomes more and more critical to make decisions on every level. Each decision opens the way for numerous other decisions. It is always necessary to ask the right question in the face of any problem. A former employee said that Initially the company, Mark Zuckerberg approached every problem by asking “Does it help us grow?” The genuine value of business planning and basic leadership is to distinguish the difficulties and pitfalls and plan around them before they happen, instead of getting caught unaware by them when the business is already set in motion.

5. Choosing What To Sell and To Whom

  • How to protect Facebook from the rumors of its sale.
  • Announcing the verdict of Facebook being an independent company.

Developing organizations confront a scope of difficulties. As a business develops, distinctive issues and opportunities demand diverse solutions because what worked a year back might not be the best approach now. Like every entrepreneur, Mark Zuckerberg was also having problem in deciding what to sell and whom to sell during his early days of Facebook. As he was one only one of his kind. The sales negotiation of Zuckerberg’s company was a major challenge when MySpace was sold to NewsCorp in 2005. At first, there were rumors of the possible sale of Facebook to a larger media company wherein Mark had already stated that he didn’t want to sell the company. Later in 2006, there were serious talks between Yahoo and Facebook for the acquisition of Facebook. It was in 2007 that Zuckerberg totally took the chance and shut the doors in the face of buyers by saying that he wasn’t looking to sell Facebook and he wants it to remain independent, at the time when the company’s worth was around 8 billion dollars.

6. Mark had to prevent the Invasion of Privacy

  • How to confide in 500 million users.
  • What strategy to implement for 100% protection of information.

In 2005 and 2006 Mark was interviewed in detail about the privacy of its users’ information. With the launch of every new product on its website, Facebook insists the users to share more and more of their personal information. The claim was that Facebook probably sells the users’ information in order to make money. It was said that the FTC and members of Congress have been looking into it; moreover, privacy groups lodged complaints against the privacy policy of the website. Zuckerberg said “We do not allow the applications to share personal information, plus, the advertisers can’t have access to it. But if application runners share it with the advertisers, we disable their functioning on our website, we shut them down. We make sure that people have control over their privacy and it will become the most fundamental thing on the internet”.

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  1. Joseph

    very informative article. thanks for sharing .

  2. Mick

    Hey, this article was very helpful

  3. Kaylea

    Great informative article,

    • BusinessAlligators Support

      Glad you find it helpful 🙂

      • Sammy Renee

        This helped me with my business problem-solving assessment. Thank you ?

  4. Amania

    Really helpful, thank you very much.

  5. mark

    It is cool

  6. Emma

    Very helpful

  7. Lea

    This was very helpful with my assignment, Thanks!

    • BusinessAlligators Support

      Glad you find it helpful 😊


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