Behind the scenes of Facebook

As most of u guys use Facebook including me, but some of us don’t know the struggle behind it! It was founded by Mark Zuckerberg and his Harvard college mates Eduardo Saverin, Andrew McCollum, Dustin Moskovitz, and Chris Hughes. It all happened 17 years ago on the 4th of February 2004. It was created in a dormitory! Before the creation of Facebook Mark Zuckerberg created a website called “facemash” in 2003 while attending Harvard University. It was similar to Hot or Not where it would compile all the photos from the Facebook of all nine houses from Harvard and placing next to each other at a time and asking the users who are hotter. Facemash attracted around 450 visitors and 22,000 photo views in its first 4 hours! It was created due to the frustration of his verbal spat with Priscilla Chan who later married him in 2012. Facemash was shut down a few days later by Harvard Administration. Zuckerberg was charged with breaching security, violating copyrights, and violating individual privacy. Ultimately these charges were dropped. After this incident, Mark Zuckerberg got the idea of creating a website was to allow the Harvard students to use their “Edu” email addresses and photos to connect with other students at school. Then-student Mark Zuckerberg foresaw a way of bringing the existing social experience of college onto the Internet. In December 2002, Tyler Winklevoss, along with his brother Cameron Winklevoss and fellow Harvard classmate Divya Narendra, sought a better way to connect with fellow students at Harvard University and other universities. This idea was similar to Facebook and the website was called HarvardConnection.com. They approached Mark Zuckerberg for his help in the creation of HarvardConnection. Mark Zuckerberg agreed to their request and he could not help them much because he was busy most of the time creating Facebook. Mark Zuckerberg approached Eduardo Saverin who was his fellow undergraduate at Harvard for co-partnership in Facebook as Zuckerberg required funding in the creation of his website known as “The Facebook”.

FACEBOOK

Zuckerberg also informed that the money generated by Facebook that is shared will be 70- 30, that is 70 percent for mark and 30 percent for Eduardo Saverin, to which they agreed. They first agreed to invest 1000 dollars in Facebook. Later, Zuckerberg and Saverin each agreed to invest another $18,000 in the operation. Mark Zuckerberg and Eduardo Saverin searched for investors for their website to develop it further. Mr . Sean Parker met with Zuckerberg and Saverin and becomes its first president. . Parker co-founded the file-sharing website “Napster” before joining as facebook’s president. But Eduardo Saverin did not like Sean Parker’s views but Parker believed in Facebook. This made Zuckerberg like him and they moved their office to Los Angeles while Saverin was on internship in New York. This angered Saverin and froze facebook’s website for a day. Parker as a president brought facebook’s first investor Peter Thiel. In August 2004, Thiel made a $500,000 angel investment in Facebook for a 10.2% stake in the company and joined Facebook's board. At that time the company was valued at 4.9 million dollars! So facebook issued many additional stocks in 2005. Due to the additional stocks, Eduardo Saverin's stakes were diluted from 30 percent to below 10% and this happened when Facebook had its first 1 million, active users. Share dilution is when a company issues additional stock, reducing the ownership proportion of a current shareholder. But surprisingly other stakeholder’s stakes were not reduced that significantly. One of the probable reasons was Zuckerberg was “jealous” of Saverin and thinks he is the real owner of Facebook. Another probable reason was Zuckerberg needed more power so he booted his buddy off. Knowing about the diluted shares Eduardo Saverin sued Zuckerburg for misusing his money for his personal needs until they finally reached a settlement for 4 to 5 percent of facebook’s stocks. Winklevoss brothers were angry about facebook’s success and sued Facebook for copying the idea of HarvardConnection in 2005 which led to a settlement of 65 million dollars in 2008! This was behind the scenes of struggles faced by Facebook that most of us don’t know about. After all the allegations facebook is one of the richest companies in the world having a net worth of roughly 720 billion dollars! It also owns many popular social networking sites like WhatsApp and Instagram. Its CEO Mark Zuckerberg owns approximately 28 percent of Facebook and has a net worth of 120 billion dollars! Mark Zuckerberg Eduardo Saverin.