Next Wave with Gary Vaynerchuk: Facebook Fallout

Before I get into my rant on where are we now on Facebook – a couple weeks after the
IPO – I want to give a huge shout out to “Jeffrey Curtis 64” who on our prediction
show was one penny off on the closing price of the first day. Alvin, you and I blew it
huge. Dollars off, we thought it was going this way (points up), Mr. Curtis knew it was
going this way (points down).
What Jeffrey tapped into is Wall Street sentiment on companies which is “what have you done
for me lately?” - quarter to quarter acton – not 5 years from now. And that’s what
the valley does. Silicon Valley where theyre investing, angel investors – where you going
to be in 4 or 5 years? That big disconnect drove it down.
Also, supply and demand, very simple capitalism. Too many shares hit the market and then NASDAQ
had a 20 minute hitch that didn’t allow the hysteria to kick in, which could’ve
really drove it. And then you end up with this “disaster”. Or so is it?
Facebook and their employees really don’t care. They made more money than they could
ever imagine and they’re really trying to build the company long term. More importantly
are we betting on Facebook right now the same way that people bet on Amazon when it first
came out? Are we analyzing Facebook as just a “book retailer”? Or what’s going to
happen long term? These battles are really going to play out in the next couple years
and are going to be really quite exciting.
Also the real people that got affected are the Twitters, Zyngas and LinkedIn in the world.
There’s going to be a huge correction in the tech bubble right now because of this
stock. Because their the king dog and everybody underneath is going to feel the pain. I don’t
see Twitter running to IPO anytime quick.
But most of all, in wrapping up, how does this effect you? See there was a jobs act
passed by Congress that’s going to allow a lot of us to invest in early stage investing
companies. We’re going from 500 investors before you have to disclose your finances
to 2000. We’re also going from a world where you had to be accredited investor and have
a million dollar in assets to a place where anybody can do it.
So you’re going to be sitting around a table debating if you should put $2000 into some
startup idea of a 16 year old in Texas very soon. And this is what you need to learn from
what we just saw: yes, there’s going to be a facebook and a twitter and you can make
lots of money. But before it goes IPO, there’s going to be a lot of dollars in it. The companies
like second market, now have the value in it. So all the upside of the IPO has changed
by modern technology, new rules and the way we’re all playing them.
So please, think twice before you run for the big IPO.