David Kirkpatrick on Facebook, Accidental Billionaires, Twitter and The Facebook Effect 8


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On Wednesday we found out (through a post by Mark Zuckerberg) that Facebook hit a quarter billion users, putting it past Indonesia as the world’s fourth populous “country.” One person who was certainly not surprised by the news was David Kirkpatrick. Although he’s currently residing in the hills of the Berkshires, there’s probably no person further inside Facebook right now than Kirkpatrick. Other than, maybe, Justin Smith of Inside Facebook.

Kirkpatrick, who I had the chance to catch-up with earlier this week for our annual pre-Brainstorm: Tech discussion, is writing six hours a day as he pushes towards a Spring 2010 publishing date for his Facebook book entitled The Facebook Effect.

Although Kirkpatrick has been open in pulling together his book through the aptly named Facebook Effect blog on Facebook, his project has been overshadowed this week by the publishing of Ben Mezrich’s Accidental Billionaires: The Founding of Facebook, A Tale of Sex, Money, Genius and Betrayal.

Mezrich, the former Harvard student who was also the author behind Bringing Down the House (adapted into the motion picture 21), has been somewhat lampooned for his fictional take on factual events by Facebook – who have resorted to calling him the “Danielle Steele of Silicon Valley.

In fact, Elliot Schrage, Facebook’s vice president of communications, has pointed to Kirkpatrick’s upcoming book on Facebook as the “real story” behind the birth and history of the company:

“This book (Mezrich’s) appears to fall in the ‘others’ category. We think future efforts will tell a better and more accurate story.”

In already reading through much of Mezrich’s take on Facebook, Kirkpatrick had some interesting views on Accidental Billionaires in comparing it with his upcoming book and the conversations he’s had with Facebook’s founder (Mezrich wasn’t granted a single conversation with Zuckerberg).

Here’s some highlights from the first part of our conversation. A second post will follow in previewing Fortune’s upcoming Brainstorm: Tech conference, which begins next Tuesday.

David Kirkpatrick: It’s moderately fun to read, and it’s also loaded with errors. I’ll provide my full point of view with more details on my blog. He’s a very diverting novelist. He’s selling something as non-fiction, but it’s only partially reported.

Portions that have not been previously reported are imagined heavily. He doesn’t actually claim to know the things that he doesn’t know very much about, and I don’t think that he has multiple sources on very many facts in general. Even some of the ones he gets right I think he lucked out on.

I mean, in the most idiotic way, it takes the angle that Sex was behind all this. Of course they started it for sex! I mean, that seems to be his attitude. But I can say gladly that Mark Zuckerberg did not start Facebook for sex.

In addition, Eduardo Saverin did not start Facebook. Eduardo was a fortunate hanger-on. He’s treated by Mezrich, as a major player. I think Mezrich does get it right with Zuckerberg, in that he doesn’t downplay his role in all of this.

RaceTalk: And there was no eating of Koala on Yachts?

DK: No, and actually I think Zuckerberg would state unequivocally that he has never eaten Koala. By the way, do you know anyone who has?

RaceTalk: No, I’m guessing that is why everyone latched onto it.

DK: If you are familiar with the story of Facebook, you won’t learn much of anything new. He accepts a lot of conventional wisdom unquestioningly, and a lot of the conventional wisdom is incorrect.

RaceTalk: How much of your book will go back this far?

DK: My book is very much going to be a thorough, definitive history. That’s one thing my book will be (I hope anyways) the definitive, authoritative, story of the company. The history of the company is fascinating, loaded with incidents and unexpected happenings – most of it unknown to Mezrich. That will be a very large portion of my book.

RaceTalk: How much time have you spent with Mark?

DK: Oh, I don’t know, hours. I’ve interviewed him five times so far.

RaceTalk: So has he changed? I mean, you’ve been interviewing him for a while, back to your Fortune stories. Have you seen a change? Not only personally but professionally?

DK: Well, he’s gotten smarter and more mature. I haven’t seen any fundamental change in his attitude. He’s had a very clear-minded view of what he was trying to do for a long time, and he understands how to do it better as time goes on.

RaceTalk: Have you ever seen a company that has innovated like this? In the last year since we talked about you launching your book project look what they’ve done with the stream, fan pages, vanity URLs. It seems they have a new innovation to introduce every week.

DK: No, they are EXTREMELY ambitious in the pace of evolution with their service.  I think you would probably say for any product for this scale, in history, in ANY industry, they make more changes more rapidly than anybody ever has. It shows both a willingness to take risks and a recognition that if they don’t keep evolving rapidly, they risk irrelevancy. They don’t have any interest in becoming irrelevant, and they probably won’t. If you look, the growth has continued regardless and it continues to spread out globally to a wider and wider audience.

RaceTalk: What effect have you seen with Twitter on their efforts? Are they reactionary at all to Twitter?

DK: Well, they’re interested in Twitter, they did try to buy it. Or they were talking about buying it. I don’t know how hard they tried in truth. Really, if you look at Facebook’s evolution, it is increasingly encompassing, among the many things it does with what Twitter does. If I were Twitter, I would be deeply uncomfortable by that. Not because it’s unfair but because it could very well lead to there being very little that Twitter does uniquely well. There is an astonishing number of near-religious advocates of Twitter in the technology industry, however I don’t think that what Twitter does is that hard for others to do, especially Facebook.

When Facebook completes the replication of Twitter’s functionality the advantage they will have with 250 million users versus 20 million Twitter users will be overwhelming. Don’t get me wrong, I think Twitter is a great service. I think Twitter is an important service and I think they think the same thing about Facebook.

RaceTalk: I did think it was interesting how Twitter became the tool of the Iran uprising.

DK: I actually think Facebook was used more in Iran.

RaceTalk: Really?

DK: Twitter is used by the press therefore they assume a lot about Twitter in this foreign context, because that’s how they are getting their information.

RaceTalk: But you saw more use of Facebook?

DK: From what I understand from Iran there was extensive use of Facebook. I think there was use of both.

I think the press coverage of Twitter over the last six months has been basically categorized by a lot of bad reporting that arises from the fact that the press itself is enamored with twitter. Journalists use it for themselves. They learn about the things they write about through Twitter, especially when they are remote things. Therefore, they assume the same thing is happening for everyone else more than they can document. They report it as if they know it for a fact.

RaceTalk: That makes sense, especially when you look at what Twitter means to journalists and media companies as a publishing tool. Even on RaceTalk we see the large traffic that is driven here through Twitter.

DK: For individual journalists Twitter is a dream come true. I will say that Facebook is going to have those same capabilities, and possiblity in a more functional manner, in the not so distant future. But any journalist that doesn’t like Twitter is stupid. Any journalist that doesn’t use Twitter is probably stupid as well.

RaceTalk: What do you think about how brands are starting to use Facebook with these vanity URL’s and fan pages? I did a story awhile back about how VitaminWater is using their Facebook page as their de-facto home page.

DK: For some consumer oriented brands they get more traffic on their Facebook page than their homepage, so they are wisely putting more and more resources into it. On the other hand, if they are intelligent users of Facebook Connect they can replicate a lot of the same functionality outside of Facebook. If I were a brand I would be doing both.It’s amazing to see the success that some of these brands are having on their Facebook pages.

RaceTalk: Do you see advertisements on Facebook tying into this? What are Facebook’s monetization plans moving forward? Are brand pages mixed with display ads a part of those plans?

DK: What you and I see on our profile pages and news feeds are very, very lucrative for them and a rapidly growing revenue stream. Facebook does not have any fundamental financial difficulty. Their revenues are growing rapidly as they have openly and repeatedly said. They’ve stated that revenues have grown seventy percent this year. There is no reason not to believe this. I don’t think monetization will be any problem for Facebook.


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