In early 2006, 1 got a call from Chris Kelly, then the chief privacy officer at Facebook, asking if I would be willing to meet with his boss, Mark Zuckerberg. I had been a technology investor for more than two decades, but the meeting was unlike any I had ever had. Mark was only twenty-two. He was facing a difficult decision, Chris said, and wanted advice from an experienced person with no stake in the outcome.
When we met, I began by letting Mark know the perspective I was coming from. Soon, I predicted, he would get a billion-dollar offer to buy Facebook from either Microsoft or Yahoo, and everyone, from the company's board to the executive staff to Mark's parents, would advise him to take it. I told Mark that he should turn down any acquisition offer. He had an opportunity to create a uniquely great company if he remained true to his vision. At two years old, Facebook was still years away from its first dollar of profit. It was still mostly limited to students and lacked most of the features we take for granted today. But I was convinced that Mark had created a game-changing platform that would eventually be bigger than Google was at the time. Facebook wasn't the first social network, but it was the first to combine true identity with scalable technology. I told Mark the market was much bigger than just young people; the real value would come when busy adults, parents and grandparents, joined the network and used it to keep in touch with people they didn't get to see often.
My little speech only took a few minutes. What ensued was the most painful silence of my professional career. It felt like an hour. Finally, Mark revealed why he had asked to meet with me: Yahoo had made that billion-dollar offer, and everyone was telling him to take it.
It only took a few minutes to help him figure out how to get out of the deal. So began a three-year mentoring relationship. In 2007, Mark offered me a choice between investing or joining the board of Facebook. As a professional investor, I chose the former. We spoke often about a range of issues, culminating in my suggestion that he hire Sheryl Sandberg as chief operating officer, and then my help in recruiting her. (Sheryl had introduced me to Bono in 2000; a few years later, he and I formed Elevation Partners, a private equity firm.) My role as a mentor ended prior to the Facebook IPO, when board members like Marc Andreessen and Peter Thiel took on that role.
In my thirty-five-year career in technology investing, I have never made a bigger contribution to a company's success than I made at Facebook. It was my proudest accomplishment. I admired Mark and Sheryl enormously. Not surprisingly, Facebook became my favorite app. I checked it constantly, and I became an expert in using the platform by marketing my rock band, Moonalice, through a Facebook page. As the administrator of that page, I learned to maximize the organic reach of my posts and use small amounts of advertising dollars to extend and target that reach. It required an ability to adapt, because Facebook kept changing the rules. By successfully adapting to each change, we made our page among the highest-engagement fan pages on the platform.
My familiarity with building organic engagement put me in a position to notice that something strange was going on in February 2016. The Democratic primary was getting under way in New Hampshire, and I started to notice a flood of viciously misogynistic anti-Clinton memes originating from Facebook groups supporting Bernie Sanders. I knew how to build engagement organically on Facebook. This was not organic. It appeared to be well organized, with an advertising budget. But surely the Sanders campaign wasn't stupid enough to be pushing the memes themselves. I didn't know what was going on, but I worried that Facebook was being used in ways that the founders did not intend.
A month later I noticed an unrelated but equally disturbing news item. A consulting firm was revealed to be scraping data about people interested in the Black Lives Matter protest movement and selling it to police departments. Only after that news came out did Facebook announce that it would cut off the company's access to the information. That got my attention. Here was a bad actor violating Facebook's terms of service, doing a lot of harm, and then being slapped on the wrist. Facebook wasn't paying attention until after the damage was done. I made a note to myself to learn more.
Meanwhile, the flood of anti-Clinton memes continued all spring. I still didn't understand what was driving it, except that the memes were viral to a degree that didn't seem to be organic. And, as it turned out, something equally strange was happening across the Atlantic.
When citizens of the United Kingdom voted to leave the European Union in June 2016, most observers were stunned. The polls had predicted a victory for the "Remain" campaign. And common sense made it hard to believe that Britons would do something so obviously contrary to their self-interest. But neither common sense nor the polling data fully accounted for a crucial factor: the new power of social platforms to amplify negative messages.
Facebook, Google, and other social media platforms make their money from advertising. As with all ad-supported businesses, that means advertisers are the true customers, while audience members are the product. Until the past decade, media platforms were locked into a one-size-fits-all broadcast model. Success with advertisers depended on producing content that would appeal to the largest possible audience. Compelling content was essential, because audiences could choose from a variety of distribution mediums, none of which could expect to hold any individual consumer's attention for more than a few hours. TVs weren't mobile. Computers were mobile, but awkward. Newspapers and books were mobile and not awkward, but relatively cerebral. Movie theaters were fun, but inconvenient.
When their business was limited to personal computers, the internet platforms were at a disadvantage. Their proprietary content couldn't compete with traditional media, and their delivery medium, the PC, was generally only usable at a desk. Their one advantage--a wealth of personal data--was not enough to overcome the disadvantage in content. As a result, web platforms had to underprice their advertising.
Smartphones changed the advertising game completely. It took only a few years for billions of people to have an all purpose content delivery system easily accessible sixteen hours or more a day. This turned media into a battle to hold users' attention as long as possible. And it left Facebook and Google with a prohibitive advantage over traditional media: with their vast reservoirs of real-time data on two billion individuals, they could personalize the content seen by every user. That made it much easier to monopolize user attention on smartphones and made the platforms uniquely attractive to advertisers. Why pay a newspaper in the hopes of catching the attention of a certain portion of its audience, when you can pay Facebook to reach exactly those people and no one else?
Whenever you log into Facebook, there are millions of posts the platform could show you. The key to its business model is the use of algorithms, driven by individual user data, to show you stuff you're more likely to react to. Wikipedia defines an algorithm as "a set of rules that precisely defines a sequence of operations." Algorithms appear value neutral, but the platforms' algorithms are actually designed with a specific value in mind: maximum share of attention, which optimizes profits. They do this by sucking up and analyzing your data, using it to predict what will cause you to react most strongly, and then giving you more of that.