At 27, Facebook’s Mark Zuckerberg is about to become one of the youngest CEOs of a publicly traded company. The feat is even more impressive considering that when Facebook pulls off its IPO in a few weeks, his company could be valued at around $100 billion.
Those accomplishments might make the following question sound crazy, but it still warrants asking: Does Mark Zuckerberg have the right stuff to helm a publicly traded company?
In terms of pure age, there’s several examples of young, public CEOs that have performed admirably in the tech sector. Dell’s (NASDAQ:DELL) Michael Dell was only 23 when his company came public; Microsoft’s (NASDAQ:MSFT) Bill Gates was 29. Both went on to create franchise companies and made shareholders a bundle.
To his credit, Zuckerberg has shown an innate ability to grow his company at hyperspeed. He also has been deft in killing of the competition, such as with Friendster and MySpace. He even has managed to put pressure on some of the industry’s giants, Yahoo! (NASDAQ:YHOO) and Google (NASDAQ:GOOG) — the latter of which launched its own social network, Google+, with minimal effect to date on Facebook’s momentum.
Zuckerberg also has a natural ability to understand the dynamics of the social world. When he launched the News Feed in September 2006, the response from users was horrendous. But Zuck moved forward because he thought it was a key feature. However, he did make some tweaks (such as with privacy features), and in the end, it turned out to be critical to Facebook’s growth.
Still, Zuck has had some major missteps along the way.
About a year after the launch of Facebook, Zuck had been conducting a number of meetings with potential acquirers like News Corp. (NASDAQ:NWS), which not only served as a distraction but caused confusion among the ranks. The company’s in-house recruiter, Robin Reed, chastised Zuckerberg with the “You’d better take CEO lessons, or this isn’t going to work for you,” according to The Facebook Effect.
Zuckerberg started to seek out the advice of proven leaders. One was the chairman of the Washington Post (NYSE:WPO), Donald Graham, who turned out to be a mentor. Zuck also hired key executives like Sheryl Sandberg, now 42, who formerly was a vice president at Google.
However, investors should be concerned with more recent actions — specifically, the Instagram deal, which flickered two ominous signs.
First, the deal shows that Facebook is having problems innovating. Considering that Facebook’s engineers are considered to be among the world’s best, it’s a mystery as to why the company couldn’t create an engaging photo-sharing mobile app for Apple’s (NASDAQ:AAPL) iPhone itself.
Second, it looks like Zuck didn’t even bother to engage his board of directors in the deal negotiations. True, the ultimate decision is his — that’s why he’s the CEO. But Zuckerberg left on the table plenty of insight and advice from a number of top-notch tech veterans, including Peter Thiel, the co-founder of PayPal; Marc Andreessen, the co-founder of Netscape; and Reed Hastings, the CEO and founder of Netflix (NASDAQ:NFLX).
Discussions with the board would not have stalled the deal much, as these tech minds are sure to understand the importance of speed. But considering many have pulled off billion-dollar deals themselves, their advice would have been invaluable.
Hopefully, the board has had a talk with Zuckerberg since then.
Still, Zuckerberg has shown a willingness to make changes over the years — and perhaps this recent episode will be another key to his learnings. Besides, no CEO is perfect. Even Gates and Dell had their blunders.
But for the most part, Zuckerberg has made the right decisions, outstsmarting his rivals. Going forward, he looks like a solid leader for the long haul.
Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of “The Complete M&A Handbook”, “All About Short Selling” and “All About Commodities.” Follow him on Twitter at @ttaulli or reach him via email. As of this writing, he did not own a position in any of the aforementioned securities.