41 million users and growing. The cool spot for coders. The hot place to test a business. The "it" company of 2007.
Harnessing the power of News Feed, the new apps, and the booming user base to make money for Facebook itself is the task of a new hire, VP of product marketing and operations Chamath Palihapitiya. Zuckerberg brought him aboard this summer to help figure out how to exploit what Facebookers call the "social graph"--those thousands of threads that make up users' connections to other people--and to create Facebook's coming targeted advertising program. Palihapitiya, 31, is tall and whippet thin, with elegant manners and a ready smile. A former electrical engineer, born in Sri Lanka and raised in Canada, he ran AOL's instant-message group, then jumped to the venture fund Mayfield. He is part Sand Hill Roadster and part freethinker; he appeared in an art film last winter making pointed comments about Silicon Valley's "old boy's club."
It is only day 67 for Palihapitiya at his new job when we sit down to talk, but he already sounds like a true believer. While cagey about details, he isn't shy about the potential he sees for targeted ads to fill Facebook's coffers. He madly sketches on a notepad, drawing a fine distinction between demand fulfillment (I want a cheap ticket to Hawaii. Now!), which the Internet has become quite good at, and demand generation, the shape-shifting set of marketing messages that conspire to get a consumer to want something. That, he says, is where he sees serious money on the table. "Facebook users are more engaged with each other," he says. "Aren't you more likely to be interested in what your friends are doing?" Google, which focuses by and large on demand fulfillment, is a $160 billion company. "For every dollar that goes into fulfillment, there are hundreds that are spent on generation," he says, particularly by the big brands. So what could Facebook be worth? Five times Google? Ten times? "Could be," he smiles.
