Facebook Increasing Staff As Much As 50 Percent
It also demonstrates the advantages of being a privately held company that's not subject to Wall Street's never-ending demands for ever-bigger profits.
Zuckerberg, in an interview with Bloomberg.com, said Facebook plans to expand its staff this year somewhere between 40 percent and 50 percent. The company currently has around 1,000 employees.
"No one else has been hiring," Zuckerberg said in the interview. "It's been a great environment for us because the economy has helped us out."
Zuckerberg, however, made it clear that he's not going on a spending binge and is keeping a lid on costs in hopes the company will achieve positive cash flow next year, according to the interview that was conducted Aug. 20 and posted Monday.
Facebook's hiring is in contrast to rival MySpace, which recently said it would cut its U.S. workforce by 30 percent and its international staff by two-thirds.
But it's also in contrast to nearly all other IT companies as well. Anyone who has ever listened in on a public company's earnings call with financial analysts knows how short-term -- read: short-sighted -- Wall Street's vision can be. Investors demand growth in profits and per-share earnings every quarter and analysts are quick to question any increase in expenses, including employee head count.
While keeping expenses under control is certainly a necessity, good managers know that a company needs to hire talented people in order to grow. That's especially true in the IT industry with its emphasis on innovation and intellectual capital. But too often Wall Street seems willing to sacrifice long-term growth prospects in favor of short-term profitability.
Facebook faces no such pressure as Zuckerberg dips into the talent pool to hire good people, possibly even at lower costs. That gives him an edge over public companies whose ability to take advantage of hiring opportunities are hindered by the demands of their quarterly bottom line.