Mark Zuckerberg and his Facebook company may have to start treating potential partners with a little more respect now they are under public pressure following the IPO.
Facebook is once again under scrutiny and criticism. Earlier this year, investors balked at the Facebook IPO which was plagued by a number of mishaps and underperformance. Now it seems that a potential Facebook partner felt he was disrespected and strong-handed by the social networking company, and has recently published an open letter to Mark Zuckerberg outlining his disgust at how negotiations went.
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Dalton Caldwell, a young tech entrepreneur had apparently met with Facebook executives to discuss a possible partnership between Facebook and his company which was in the process of developing an iOS app. Apparently, this was seen as a threat to Facebook's own goals.
"The execs in the room made clear that the success of my product would be an impediment to your ad revenue financial goals, and thus even offering me the chance to be acquired was a noble and kind move on their part."
Caldwell was upset because he felt Facebook would simply absorb and overshadow his company, a strategy he termed "aqui-hire."
"...I had zero interest in seeing my product shut down and joining Facebook. I told your team I would rather reboot my company than go down that route."
He didn't stop there however. Caldwell went on to say this was part of Facebook's common strategy - to acquire a company rather than work with it so that it can control the decisions.
"Mark, I know for a fact that my experience was not an isolated incident. Several other startup founders & Facebook employees have told me that what I experienced was part of a systematic M&A "formula". Your team doesn't seem to understand that being "good negotiators" vs implying that you will destroy someone's business built on your "open platform" are not the same thing."
Caldwell took the incident so strongly that he is now on a mission to create an ad-free social network, App.net, to compete with Facebook, because he believes that ads get in the way of a true social network's functions.
"We believe that advertising-supported social services are so consistently and inextricably at odds with the interests of users and developers that something must be done," says the App.net website.