Warren Buffett advised Mark Zuckerberg, won't buy Facebook shares
Summary: Facebook co-founder and CEO Mark Zuckerberg recently asked Berkshire Hathaway CEO Warren Buffett for advice. Although the two men talked for hours, Buffett doesn't plan to invest in Facebook.
Facebook co-founder and CEO Mark Zuckerberg didn't just seek advice from the late Apple co-founder and former CEO Steve Jobs. Most recently, he's been getting guidance from investor Warren Buffett on how best to take the social networking giant public. That being said, Buffett has stated he isn't interested in buying Facebook stock.
Buffett says he and Zuckerberg talked for hours, according to a message from CNBC's Becky Quick on Twitter:
Buffett just told me he spoke to Mark Zuckerberg for hours about taking Facebook public. Offered advice. #BuffettWatch #BRK2012
That's not all. At the Berkshire Hathaway annual shareholder meeting today, Buffett says he won't be buying Facebook shares. Well, for now anyway. There's nothing stopping Buffett from changing his mind eventually.
The Berkshire Hathaway CEO was specifically referring to investing in Facebook's initial public offering (IPO), but he did note that what's happening in Menlo Park the is "extraordinary." Buffett told CNBC that "people get excited about companies that have done that well," but didn't elaborate further. He did however deny talks of an Internet IPO bubble.
"It is not a bubble ... this is not what we were seeing in late 1999 all the way into 2001," Buffett was quoted as saying. We aren’t in any bubble phase of anything."
Rumor has it Facebook will launch its actual roadshow Monday and go public in less than two weeks. Shares are expected to be priced on May 17, with trading beginning on May 18.
See also:
- How much is Facebook worth?
- Facebook files for $5 billion IPO
- Facebook's IPO in pictures and Facebook's IPO by the numbers
- Facebook updates IPO filing to underline Zynga deal
- Facebook details Zuckerberg's $500,000 salary, 45% bonus
- Facebook amends IPO a fourth time, includes Q1 2012 financials
- Facebook sets $28 to $35 IPO price range
- Facebook roadshow kicks off with a video, IPO prospectus released
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Talkback
Buy
Facebook is a FAD, not a product with a market
Investing on Facebook when it already peaked is totally stupid. The company has ZERO chance of real growth. The best anybody can hope is that the FAD last longer than normal .... but that is very unlikely given the current down spiral state.
What does facebook offer? It's not an answer to an actual NEED.
Pagan jim
Social Connectedness
Got me killed
This time around, I don't worry so much about 'needs'.
Many say that of Apple products
:|
And some use it for productive work....
Translation: You have to be a fool to invest on Facebook
Here is a question to people who are still not getting it: How much have investors made after investing on Groupon and Zinga??
Guess what? Facebook is in the exact same category of stock quality.
No suprise here
Yes he is, but........
Invest Wisely
http://www.searchengineroyalty.com
Buffett *not* expressing Facebook offering opinion
You might be right, but,...
Warren Buffett is correct!
If the FB IPO was legit and the application platform would have a good ROI, than he would invest. But since he looked at the numbers they truth starts to reveal an overinflated marketing circus of marketing companies working for shares to promote a worthless stock.
(If the application was SOLID, it would sell itself) Since they are spending more on marketing, and have hired all former marketing chiefs, than this company will by only for marketers, so its a marketing social network. The product they are selling is not solid which means they need to spend 90% marketing it.
PLUS, the code is developed in PHP. So this has NEVER been talked about. What are their plans about this? PHP??
When you break the numbers down, they are SELLING each users data for less than $1 dollar per user, which from data from previous years shows that this number is falling. Then when you calculate the amount of money they plan to make given the estimated value of said IPO, you start to wonder that it would take every person in the world to become a member inorder for them to get a mild return from investors. Chances are that every human on the planet using FB are very slim. Taken into consideration that the majority of new userbase is just marketing bots you start to wonder the QUALITY of marketing they are selling.
Additionally when you sign up as a business, to market to FB users the evidence of amount of people who viewed your ad is NEVER displayed. This is due to FB policy online, that no user can see this information. So why would marketers pay for a service with zero results.
When you look at their books and the estimated projections of this IPO, states that 100% of income is from marketing customers. So there you have it, with nothing to sell to the public, no products, no services, and one hundred percent coming from marketing than you wonder how are they going to do this. Impossible when you calculate the numbers they never lie.
Another factor is the laws of privacy and the changes in perception of unwantingly sharing of users data. As the stock starts to fall, they will be more determined to change their privacy policies in order to profit more which will ultimately create mass account deletions.
When people sart to see the amount of wasted time spent on those social networks. Social networks are so 90's, just a fad. Look at myspace for an example at the overall outcome of this stock.
What made me turn off this IPO was the amount of marketing companies getting shares for promoting misleading information.
I will not be investing in this IPO.