Thursday, 21 February 2013

Business lessons from "The Social Network"

I have watched "the social network" twice and I bought a DVD and plan to watch it again at least one or two times, the truth is, I am not a fan of Facebook, I had a Facebook account for myself and seldom log in. But I am a huge fan of this movie, I have been inspired each time, and as a small business founder, I have to say I have learned many things in this movie from business point of view,  "The Social Network" is not just a movie telling a story about Facebook, it teaches us business lessons in many levels which you never learn in school..

Keep the bigger vision and shoot for the big fish

From Sean Paker’s “Victoria's secret” story to Mark Zuckerberg's

decision to not go for ads in the beginning, through the movie it keeps telling us one thing, that is how important of having a vision to a business. Facebook's popularity and quick rise has nothing to do with Mark Zuckerberg's programming skills. Technically, there are many programmers could code same website as Facebook, but having a vision of creating such a website which allows people to express themselves and keep in touch with the world is absolutely brilliant and few people can have it.   

It is not about who has an idea it is about how to execute an idea and make it happen

In the movie, Winklevoss twins claimed that Facebook initial idea was from their "HarvardConnection" but stolen by Mark Zuckerberg, whose character in the movie later said to them during a deposition, "If you guys were the inventors of Facebook, you would have invented Facebook."

Facebook happened is because Mark Zuckerberg had the chops, the confidence, the vision and the discipline to make it happen, people say there are two ways to make a living in business  (I would rather say, to survive in business): be first or be faster than the others and be smarter than the others, so if you have a big idea, you should know that you probably aren't the only one. Your job is to get busy making it happen.

Get your job done first and money will come to you 

In the movie, when Mark and Eduardo had an argument about whether Facebook should add advertisements to increase their revenue and they asked Sean Parker's opinion, rather than giving a straight answer Parker gave a analogy of having all the little fish versus the big fish, it means if you have something really cool, don't rush to sell it, you need to keep improving it till one day your customers are happy with that then money will come to you.

When you create a product that gives great value to your customers or you deliver good services to your consumers, they will tell their friends. If you keep delivering the same high level of value and also constantly improve the value you are giving, money will find you. Consumers can't buy an idea; they can only buy hard goods and services. Focus on making the product and services as amazing as possible and it will begin to sell itself. Let money chase you; don't chase the money.

Find people who are aligned with your vision

Mark Zuckerberg represents Facebook, but he is not everything of Facebook.  Behind the success story of Facebook, there is a whole bunch of people working around him and together they make it happen. From capital funding to social marketing to each new features showing on Facebook, as there are many talents have joined with him and make Facebook become bigger and stronger, and Mark Zuckerberg himself also has changed from a product person, a website founder to a business leader.

A good business leader is the person who surround himself/herself with good people who are aligned with his/her vision and allow them to do what he/she hire them to do to and also can unlock their potential to be able to add value into the business. 

Business is like fashion,  is always evolving and moving quickly

Remember the scene in their Harvard dorm, Severin asked Mark Zuckerberg when the webiste would be done. Zuckerberg said it never will, he explained that "Facebook, like fashion and fashion is never finished".  For many businesses if they don’t keep up with new and emerging technologies and consumer trends, they could quickly be left in the dust by their competitors, and this is happening everyday and everywhere. So it is important to be open to new idea and trends, once you go down this path, you are never finished.

Find a business mentor who can take your vision further and put it into practical way 

Sean Parker was a particular interesting character in the movie(although in reality Sean Parker himself admits his character was exaggerated), he is visionary, his ideas has inspired Mark Zuckerberg to make Facebook happen; he gets skills, the software he coded in his 20s has changed the game of entire music industry; he knows business/finance, he introduced Zuckerberg to Venture Capital firms and paved the way for Facebook to be one of biggest and fastest growing web company ever.....  he is a mentor of Mark Zuckerberg, if there was no Sean Parker, what could happen is, like what he said to Mark Zuckerberg, Facebook could be taken over by investors and Mark Zuckerberg could be kicked out of Facebook board any time by stock dilution.
Having a good business mentor is important to a business, especially in its start up. A good business mentor is from real world, is not someone who only teach you from textbook. they come to you for achieving long term goals not just resolving a particular issue.

I am sorry, Mr CFO

He came from a wealthy family, he was a member of Phoenix S.K. Club in Harvard, he made $300,000 by predicting oil futures with his algorithm
in one summer while studying at Harvard, and in Facebook early days, he was the first CFO and one of four co-founders and he provided funding for Mark Zuckerberg to get operation off the ground and he called himself the only friend of Mark Zuckerberg. But when Facebook was blowing up, he wasn't there and he moved to New York looking for internship and stayed at school, and in the end a friendship turned sour and he left Facebook.  In this film, it is sad to see what happened to Eduardo Saverin. But there is something for sure which we couldn't see from him, is a passion, a passion about following your dream and doing what you believe to do and vision of the future of his company, and because of these reasons eventually he was screwed by Facebook  investors. He played his role as an investor who puts his money in and expects a higher return rather than a role being a part of Facebook family to live and breathe it. 

by Chen Yang



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