Episode 25: The Facebook IPO

**David Rosenthal** (0:00)
Hey, Acquired listeners. A note about this show before we get started. Ben and I recorded this episode the night before the 2016 election day in the United States. At the time, the biggest change we saw coming was adding a new type of content to Acquired in analyzing IPOs, which we introduce in this episode. Two days later, we woke up to a very different world than the one we were expecting. Reflecting on what's happened in the past few months of our show, we wanted to say two things. First, we apologize for our cavalier attitude towards this election cycle over the past couple episodes and our glossing over of the clearly very real problems and deep divide in America that it represented. In the Skype episode, I pretty glibly compared the AT&T-Time Warner merger to Make America Great Again, arguing that any reactionary force is on the wrong side of history and cannot be relevant in a changing world. I was wrong. That sentiment is wrong. And it's insensitive to the very real pain that a lot of people are obviously feeling out there on both sides.

**Ben Gilbert** (1:04)
Second, looking back on the episode, we think it actually presents a relevant parable for our country right now and, we hope, some important lessons for the technology industry going forward. For all its wonderful aspects that we celebrate on the show, there is no doubt in my mind that the tech industry shoulders a lot of the responsibility for the current divide in America and especially in its contribution to wealth inequality. Likewise, for all the wonderful aspects to the Facebook IPO story that you're about to hear, there is a very clear dark side as well. Facebook shareholders, investment banks, and institutional investors raked in billions of dollars at the expense of public retail investors who lost their shirts.

**David Rosenthal** (1:42)
At the same time, Facebook's perseverance and their determination in overcoming what were massive existential challenges to their business model, as you'll hear about in this episode, at incredible speed, we think can be an inspiration to us all right now on how to move forward when it doesn't look like that's super possible. We hope you'll listen to this episode with that in mind and think about how you and we and the technology industry as a whole can do better in serving everyone in this country and in the world. Thanks for being on this journey with us. We're sorry for our shortcomings. We're going to keep working really hard to do better. With that, on to the show. Is it you?

**Ben Gilbert** (2:39)
Welcome back to episode 25 of Acquired. The podcast about technology acquisitions. Today's episode, we're trying something new. We're piloting a new idea, analyzing IPOs in addition to our normal acquisition format. When we started the show, our goal was to understand what made an acquisition go spectacularly well. And over the past 24 episodes, we've started zooming out and asking ourselves exactly why that is. Both David and I are really trying to understand how to create big, enduring companies. And we know that's why a good chunk of our audience listens to the show.
Oftentimes, you can have these huge, successful acquisitions, but that's not the only goal. The goal for us and for many entrepreneurs is to create lasting value. As we thought about what direction we wanted to take the show, it became more and more clear to us that we should be looking at companies that don't get acquired, but go all the way to going public. And really, these are even a better example of building hugely valuable companies. So today, we're starting with a monumental IPO in recent history, Facebook.

**David Rosenthal** (3:38)
Dun-dun-dun.

**Ben Gilbert** (3:39)
Oh, yes.

**David Rosenthal** (3:40)
I'm really excited for this, and I hope you guys are too. Not that we're going to stop doing acquisitions, but we thought this was, as Ben said, just a great direction to take the show. So let us know what you think in the Slack channel, by email, on Twitter. We love feedback here at Acquired.

**Ben Gilbert** (3:57)
Very true. And in typical, both of us are very involved with early-stage companies in different facets, and in kind of typical customer validation, customer development format. Be harsh. We love all your criticism, and we want to make Acquired the best show possible for you guys.

**David Rosenthal** (4:15)
It helps us make the show better.

**Ben Gilbert** (4:17)
Through that. This is a great time to tell you about one of our very favorite companies, Crusoe.

**David Rosenthal** (4:23)
So Crusoe, as listeners know by now, is a clean compute cloud provider, specifically built for AI workloads. NVIDIA is one of their major partners, and literally Crusoe's data centers are nothing but racks and racks of A100s and H100s. And because Crusoe's cloud is purpose built for AI and run on wasted, stranded, or clean energy, they can provide significantly better performance per dollar than traditional cloud providers.