When Facebook's IPO became "#Fail" this past May, finger-pointing started almost immediately. But as the dust settles, it's more apparent than ever that there's plenty of blame to go around -- and investors themselves can't be spared.
Despite a compelling argument by Andrew Ross Sorkin in yesterday's New York Times, blame for the company's disastrous public offering can't be laid chiefly at Facebook CFO David Ebersman's door. Nor can it be attributed to the poor management of Mark Zuckerberg, as Forbes blogger Nathan Vardi maintains today.
For one thing, Ebersman and Zuckerberg didn't act alone. They had the backing of Morgan Stanley and other Wall Street underwriters. What was to stop these people from stepping in and setting Facebook's leadership straight?
Then there's Nasdaq, whose technology hiccups ruined Facebook's initial trading session.
There are other places to point the finger. High-profile investor Mark Cuban says brokers and even investors themselves must shoulder some responsbility for not doing the diligence that may have helped them resist the emotional rollercoaster that led to the inflated value and quantity of Facebook shares.
In a way, I agree with Cuban. Before the IPO, there was plenty of evidence that Facebook wasn't quite worth what the IPO pundits were quoting. Internet Evolution's Nicole Ferraro
predicted that Facebook would stumble even before the bell rang on that fateful day in May.
In the hierarchy of blame for Facebook's faceplant IPO, the role of those on the bottom rung -- the investors themselves -- must be acknowledged. Without them, the decisions made by Facebook's management, underwriters, and IPO supporters who work in the public markets couldn't have resulted in the multibillion-dollar fiasco that's made history for the wrong reasons.
There are lots of hard lessons here. It's time for everyone involved to face the truth and learn from it. If we don't, we're doomed to repeat this unpleasant exercise in greed.
— Mary Jander , Executive Editor, Internet Evolution