Would You Turn Down a $100 Million Buyout Offer?
Why did entrepreneur and former Facebook employee Dave Morin turn down a $100 million buyout offer for his start-up, Path?
Dustin Moskovitz, Facebook's co-founder and a Path investor, thinks he had something to do with it.
Morin launched Path, a smaller social network, in November, 2010. In December, Google offered him a $100 million buyout, plus a $25 million earn out over four years. He said no thanks.
"I can't take full credit," Moskovitz, 27, said at TechCrunch Disrupt, "but we happened to be on vacation together. It was me, him, and Brian Singerman of Founders Fund. It just was really clear from Dave's body language and what he was saying that he didn't want to do the deal. He was feeling pressured to do it. People were telling him, 'Take the deal, don't risk it all.' The lesson learned is [founders should] set expectations higher [for themselves and their companies]."
Moskovitz, ranked by Forbes as the world's youngest billionaire (he's eight days younger than his former roommate, Mark Zuckerberg), also set the record straight on the early days of Facebook. Despite what you may have seen on The Social Network, it was not a nonstop party.
"When we founded Facebook, we put a lot of hours into it and worked hard every day. The Social Network painted this picture that we were partying all the time, when really we only attended 2 or 3 parties during Facebook's first year," he said.
He also said that the founders knew they had a hit on their hands from Day Two.
"Facebook was founded on February 4, 2004," said Moskovitz, who served as the company's first chief technology officer. "On February 5, we were feeling pretty confident, even from observing the first few hours of usage. Students used it like crazy. They'd sign up then spend the next 3-4 hours on it. Then we'd go to lecture hall and see it on every computer screen there."
Moskovitz left Facebook earlier this year to launch Asana, which focuses on workplace productivity.
He says he left reluctantly, and because he had a big idea.
"We left Facebook because we had an idea. We looked for every reason to stay [at Facebook]. I didn't want to be an entrepreneur. But the idea was so strong and we became so passionate about it," he said.
The most important requirement for an entrepreneur? A great idea.
"There are a lot of people building small ideas now," Moskovitz said. "There's an idealization of being an entrepreneur, but the most important thing is to have a really great idea."
Inc. contributing editor Courtney Rubin was for five years a London-based staff writer for People magazine. Rubin, a former senior writer for Washingtonian magazine, has written for the New York Times magazine, Time, Marie Claire, and other publications. She is the author of The Weight-Loss Diaries.