Facebook nabs exec at Google
It was the shot heard ‘round Silicon Valley: Internet upstart Facebook Inc. raided search giant Google Inc. for a No. 2 executive it hoped would turn the social-networking website into a major moneymaker.
Facebook said Tuesday that it hired prominent Web executive Sheryl Sandberg, 38, as chief operating officer. The 4-year-old company is betting she will help manage its breakneck growth as it expands overseas and will generate advertising revenue without alienating the site’s 66 million users.
As vice president for global online sales and operations, she ran Google’s lucrative advertising arm, which generates 99% of its revenue and employs thousands of people.
Silicon Valley observers credited 23-year-old Facebook Chief Executive Mark Zuckerberg, who founded the company while a Harvard undergraduate, for showing maturity in bringing aboard such a seasoned executive to advise him.
Several people drew comparisons to Microsoft Corp.'s move in 1998, when then-CEO Bill Gates named Steve Ballmer president and handed off some operational responsibilities so Gates could focus on the company’s technical vision.
Having an experienced management team that investors can trust is a crucial piece of Facebook’s plan to hold an initial public offering next year or in 2010.
Reporting directly to Zuckerberg, Sandberg will lead the charge in developing an advertising network for Facebook, a key strategic initiative to justify the $15-billion valuation its private investors gave the Palo Alto company. She will also oversee marketing, human resources and privacy.
“Facebook represents one of the most exciting opportunities there could be, if not the most exciting opportunity,” Sandberg said.
Internet consultant Dave McClure said Sandberg brought a potent combination of business smarts, political influence and instant credibility to Facebook.
Sandberg is one of Silicon Valley’s most prominent women executives, with a powerhouse resume that includes a stint as chief of staff at the U.S. Treasury Department during the Clinton administration.
The systems that Sandberg oversaw at Google after joining in 2001 generate billions of dollars a year and place ads on millions of sites.
“She’s about as solid as you can get,” McClure said.
Over the last year or so, Facebook has grown by leaps and bounds as online social networking has become a national pastime.
As the hottest tech start-up in Silicon Valley since Google, Facebook now regularly scuffles with the Internet giant for top talent.
In July, it hired Gideon Yu, the former chief financial officer of Google-owned YouTube Inc., to become its CFO. Facebook’s buzz also has helped lure away a number of high-profile Google engineers.
Microsoft invested $240 million in October for a tiny stake in Facebook. The deal valued Facebook at $15 billion.
But the company’s rapid rise has brought greater scrutiny. Critics questioned Zuckerberg’s judgment in November when Facebook rolled out an advertising tool that angered users by exploiting connections between friends.
Sandberg’s hiring comes after last month’s announcement that Owen Van Natta, Facebook’s chief revenue officer and former chief operating officer, would leave to pursue a chief executive role at another company.
Zuckerberg said Facebook had been in discussions with possible candidates for more than a year. That all changed when he met Sandberg at Silicon Valley financier Dan Rosensweig’s Christmas party. Their talks intensified at the World Economic Forum in Davos, Switzerland, and at a series of dinners at Sandberg’s Atherton, Calif., home.
“We are an organization scaling very quickly across different dimensions,” Zuckerberg said. “We were looking with this hire for someone who could help us scale operationally and globally. Sheryl is a really smart person who shares our values at this company and who has a track record of being able to do that.”
Her mentor, private equity investor Roger McNamee, urged Sandberg to join Facebook after she asked for his advice about a different job offer she was weighing. McNamee, a Facebook investor, said Zuckerberg and Sandberg shared similar values and complementary strengths.
“This was a chance to do something transformational in the most important company in Silicon Valley,” said McNamee, a managing director at Elevation Partners.
Sandberg, whose Google holdings have made her a multimillionaire, said she felt a deep connection to Zuckerberg’s vision. She denied she was being groomed to succeed him.
Some departed Googlers have said they could no longer have a meaningful effect on the Mountain View, Calif.-based company, which now employs nearly 17,000. Sandberg said she was seeking a new challenge and trying to recapture some of the start-up excitement she experienced in the Internet giant’s early, go-go days.
Google said it drew from its “deep management bench” to replace Sandberg with her longtime deputy, David Fischer, vice president for online sales and operations.
“Sheryl was a valued member of the Google team and we wish her well in her new endeavors,” Omid Kordestani, Google’s senior vice president of global sales and business development, said in a statement.
(BEGIN TEXT OF INFOBOX)
Name: Sheryl Sandberg
Title: Chief operating officer of Facebook Inc.
Career: Joined Google Inc. in 2001. Served as vice president
of global online sales and operations. Also managed global operations for Google’s consumer products and helped launch Google.org, the company’s philanthropic arm. Previous jobs include chief of staff at the Treasury Department during the Clinton administration, management consultant at McKinsey & Co. and economist with the World Bank, where she worked on eradicating leprosy in India.
Education: MBA, Harvard
Business School. Bachelor’s degree in economics, Harvard.
Family: Married to David Goldberg, an entrepreneur-in-residence at Benchmark Capital and former head of Yahoo Music. Mother of two.
Sources: Facebook, Google