Mark Zuckerberg, Facebook’s CEO and one of its co-founders, is widely praised as one of the tech industry’s most successful entrepreneurs. Zuckerberg started Facebook with a few friends as a 19-year-old student at Harvard as way for students to keep up with their classmates—and find out which of them are single, among other things. Today, Facebook is a $350 billion company with revenue of almost $18 billion in 2015.
So it’s not surprising that Y Combinator, the prestigious startup accelerator program, selected Zuckerberg as the first guest on its new video series, “How to Build the Future.” Here are some of the most interesting comments from the interview with Y Combinator president Sam Altman:
Yahoo’s acquisition offer in 2006 was a pivotal moment for Facebook
“One of the hardest parts for me was actually when Yahoo offered to buy the company for a lot of money. that was a turning point in the company,” said Zuckerberg. “It was the first time we had to look at the future and say, ‘Wow, is what we’re going to build be actually more meaningful than this?’”
At the time, many of Facebook’s early employees were in favor of selling—a $1 billion exit is certainly a “home run,” as he described, for any company in that position. But Zuckerberg believed Facebook had a bigger mission, and that’s when he realized he hadn’t communicated that well to his team.
The Yahoo (YHOO) offer was also the last time Zuckerberg has considered selling Facebook, he revealed.
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Facebook acquired Oculus because it needed the expertise
In 2014, Facebook announced its acquisition of Oculus, a young virtual reality company, for $2 billion before the startup even had a product on the market. According to Zuckerberg, it made the move because it didn’t have what it takes to jump into virtual reality internally. “If we’d done a better job of building up some of the expertise to build some of this stuff internally, then maybe we wouldn’t have to do that,” he said.
Bigger picture, Zuckerberg said he believes that ideally, companies shouldn’t be in a position where they need to make massive bets or shifts. “I actually think when you do things well, you shouldn’t have to do big crazy things,” he said. “I think the key is building a company, which is focused on learning as quickly as possible.”
Facebook’s News Feed, for example, was controversial at first as it seemed like a massive change to Facebook’s service. But Zuckerberg disagrees. The feature was born out of behavior users were already exhibiting: clicking around their friends’ profile pages to see new updates. The News Feed really wasn’t a big bet, according to Zuckerberg, it was simply the natural evolution of the product.
Zuckerberg didn’t originally think Facebook would be a company
“I built the first version of Facebook because it’s something my friends and I wanted to use at Harvard,” said Zuckerberg, adding he didn’t think it would become a company.
That realization actually came about six months into it, when Silicon Valley investor and PayPal (PYPL) co-founder Peter Thiel invested $500,000 into Facebook (its first outside investment), and Facebook formally registered as a Delaware corporation, he said.
But even then, both Zuckerberg and co-founder Dustin Moskowitz still didn’t think it would become their full-time job. “Dustin and I were very clear with him that we were planning on going back to school,” Zuckerberg said of those early days. The two then took one semester off, then another, and before they knew it, they had entirely dropped out of college to focus on the nascent social network.
“I think he would probably say that he knew we are not gonna go back to school or that he believed that he could talk us out of it,” Zuckerberg surmised Thiel thought of their claims they’d go back to college.
Zuckerberg’s lesson and advice to entrepreneurs: “The most important thing that entrepreneurs should do is pick something they care about, work on it, but don’t actually commit to turning it into a company until it actually works.”
Facebook’s 3 areas of focus
- Connectivity: Connecting as many people around the world to the Internet
- Artificial intelligence: This technology will be crucial in the future, and even “save lives,” according to Zuckerberg.
- The next computing platform: Virtual reality will be the next one, according to Zuckerberg.
Thiel’s best advice to Zuckerberg: Take risks
Asked about the best advice Thiel has given him, Zuckerberg recalled this: “In a world that’s changing so quickly, the biggest risk you can take is not taking any risk.”