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There are counterexamples, sometimes the road to success is to bite the bullet and spend heavily. IBM spent five billion dollars to develop the IBM System/360 line, back when a billion was serious money. Neither Airbus nor Boeing would be where they are today without investing big sums up front. Making AAA games these days basically requires it, Google Stadia is floundering because Google shied away from putting enough money into their game studio to be competitive.

Is this not, essentially, the innovator's dilemma? Facebook has to increase profits at a large scale now, and doubtlessly suffers from middle-management power jockeying, and so is unable to repeat the small market growth process that made them what they are today.

They could cut costs and just try to be good at being a better Facebook. I know that is heresy in the stock world.

I think they effectively cannot. There would be a shareholder's revolt.

How do they revolt? Facebook shareholders cannot remove the Zuck and he doesn't need their money. They have zero power.

Which doesn't matter as Zuckerberg controls too many voting shares. Investors spent money while not receiving voting power ...

And those of us with Privacy concerns don't see this as a bad thing. However, it could be of concern if it is successful, and probably for more than just privacy. If anyone reminisces about the internet of 10-15 years ago, imagine if you will one absolutely dominated by Meta's virtual garden.

Well, it depends. Let's say this was 1990 and IBM instead of Facebook deciding that the internet is clearly the future and invest billions into it. Could have been the right move. They're betting on AR and VR as a medium, and I wouldn't bet against that long term. The question is if they can actually make something useful. Even if you know something will be successful it's still hard to find a way to capitalize on that. Your timing could also be years off. It was hard to foresee a search engine being the most valuable internet company.

If you haven't seen it yet, you might appreciate this slide deck about how organizations are like slime mold.

Slide 57 main image "0.60=0.95^10", text "And thanks to that non-linearity, even a small decline in individual likelihood [of success] leads to a much lower overall decline in the likelihood of success."

https://komoroske.com/slime-mold/

I disagree that slime-ball force is inescapable.

I think our industry has a huge "boulder" - we often work on useless software that is far too removed from real world applications, which causes us to lose our passion.

When you have 50 engineers maintaining a boring piece of crap software which can be maintained by 5 engineers, you will start noticing the productivity going down. Engineers who used to be very productive will slow down to meet the low expectations.

Brainstorming a way to avoid this problem:

- working on things we're passionate about with real-world impact

- having a bunch of small organizations with small number of employees (maybe Mark should break down facebook into 50 smaller companies)

- stop creating redundant jobs; if things are not going well, adding 100 people to a project isn't going to fix the delayed project

> 50 engineers maintaining a boring piece of crap software which can be maintained by 5 engineers

https://www.youtube.com/watch?v=aXQ2lO3ieBA

"If thats the Bradley, then what's this? [...] How did they get to that from this?"

General: "This all well and good Col. Smith. But with this gorilla in production I don't supposed there's going to be anything left in the budget for my scouts. . . . This is a speedy vehicle, why can't it be both? . . . We'll just stick a turret on top with lots of opticals. . . . We aught to get the biggest bang we can up there [in the turret]."

Other general: "Add on some firepower!"

> I disagree that slime-ball force is inescapable.

Please do go through the deck. At about 152 the author talks about a way through organizational headwinds. Also, the thesis is that an organization's ability to mutate and respond in a balance between collective and cellular methods is similar to a slime mold in a positive way (slide 149).

That's because you are comparing Facebook to startups when you should be comparing Facebook to AT&T. AT&T spent billions on Bell Labs and gave us the transistor among other things like modern day switching networks. AT&T was a government sanctioned monopoly, and for that privileged they spent billions on research.

Keep in mind that billions were already spent on the technology behind the metaverse in research institutions and government labs. Think internet, computers, AI tech, VR tech, all had billions of investment from the public sector already.

What you are seeing with the metaverse is a privatization of the technology that already had substantial public investment.

And even your startups are just piggy backing off billions spent in research. Google itself was started by a government grant for example.

In other words when you look at spend at starups, you are just looking at the tip of an iceberg. Where under the water there was billions spent already by the public.

There's a ton of money and there's a ton of money. Facebook has a ton of money to spend. Whether they succeed or fail is anybody's guess but this kind of investment can't help but move the needle on AR/VR tech.

Not necessarily so if it’s all closed sourced proprietary tech. For example I don’t think Newton had accelerated pda tech probably the opposite

Even closed source proprietary tech moves the industry forward. Engineers switch companies. Patents are filed. Competitors reverse engineer products. The knowledge diffusion is slower than with open source but it does happen eventually.

Is that not pretty much the story of Oculus so far? There are 2 million oculus quest 2 devices out there now and they're getting to the point where they have a monopoly in VR

Didn't Oculus "succeed" already before FB bought it and invested huge amounts of extra money?

They have only sold millions of devices since being part of FB. They were still really niche in 2014.

How about Tesla?

Tesla followed the same model, no? Roadster -> Model S/Y/X -> Model 3

Same: https://www.tesla.com/nl_NL/blog/secret-tesla-motors-master-...

I agree with you for the most part, but what the companies you gave examples of lacked is a Zuck. None of them had someone who could execute as effectively as he could.

https://stratechery.com/2021/meta/

Facebook's current market position is almost entirely based on being there at the start. Mark knows this and is terrified of missing out on the start of another big thing.

> Google, Apple, Airbnb, Stripe, none became the giants they are because they spent billions on a grand vision.

Google set out to catalog the entire internet on day one. If that's not a grand vision that they spent billions on, what is?

AirBNB set out to disrupt the entire vacation rental market.

Stripe set out to disrupt the entire POS payment market.

Apple is the only one who fits your narrative: they set out to make a hobby PC then Jobs wanted to ... oh right, disrupt the entire PC market with Mac, but that came 7 years later so OK.

Might be good to take a closer look at history.

#GOOGLE

Google started as a research project called BackRub. It only turned into Google and a mission after it started taking too much bandwidth on Stanford's servers

Source: https://inshorts.com/en/news/google-began-as-a-research-proj...

#AIRBNB

Airbnb began just so that the founders could make some extra money to pay rent. Not to disrupt an industry.

Source: https://www.businessinsider.com/how-airbnb-was-founded-a-vis...

#STRIPE

Stripe was just a small project so the founders could simplify getting paid for their other side projects.

Source: https://www.startupgrind.com/blog/the-collison-brothers-and-...

# GOOGLE

"calling it a "web crawler" designed to roam the web. "

I'm right.

# STRIPE "At the time Patrick was working on several side projects and they debated why it was so difficult to accept payments on the web. They sought to solve the problem and see if it was possible to make it simple - really simple. "

I'm right.

# AIRBNB

I'm wrong.

The first two set out to do something huge.

The OP probably means once a company is already established and has their core product peaked at max profit, they struggle to innovate further and build new products. Working at FAANG; I can see the desperation my org has in trying to build the next generation to remain relevant.

He also said “build something small for a small audience” and that applies to the start of all the companies you mentioned. Even Google. Back then, the internet was small, and enthousiasts a small group (relative to the global population).

> Not sure what you are smoking, but can I have some?

Why would you feel this is necessary?

(edit: I see you edited it away, but I still feel like it’s worth calling out.)

Stop making words up that the author did not say