The Accidental Billionaires - Ben Mezrich

32 Pages·2012·0.27 MB·English

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BEN MEZRICH is a graduate of Harvard University. He has published
ten books including Bringing Down the House, Rigged and Ugly
Americans. Bringing Down the House was the basis for the movie 21
which was released in spring, 2008. Mr. Mezrich is a columnist for
Boston Common and a contributor to Flush magazine.
1. The FaceMash Experiment
Facebook was co-founded by Eduardo Saverin and Mark Zuckerberg who
became best friends when they met as Harvard undergraduates in October
2003.
Mark Zuckerberg was a sophomore at Harvard in the fall of 2003. He was a
computer science major from New York, the son of a dentist father and a
psychiatrist mother. While at high school, Mark created a software program
called Synapse. This was a plug-in for MP3 players which allowedthe device to
learn a user’s preferences and then create tailored information. Mark had
posted Synapse as a free download on the Web and this caused a number of
major companies to contact him with offers to buy the software. It was
rumored that Microsoft had made Mark a two-million dollar offer to go and
work for them but impressively Mark had turned them down.
Eduardo Saverin, by contrast, didn’t know much about computers at all. He
was a business major. During the summer vacation break, Eduardo had made
three hundred thousand dollars by investing in oil futures with his brother
utilizing an investment strategy based on meteorology. Eduardo’s family were
Jewish and had barely escaped the Holocaust to move to Brazil before being
forced to relocate again to Florida, where Eduardo’s father had become very
successful in banking.
As Harvard undergraduates, both Mark Zuckerberg and Eduardo Saverin were
outside the more popular student groups because they were different. To
counter this, Eduardo was working hard to get admitted into the Phoenix – one
of Harvard’s eight “Finals Clubs” which formed the university’s exclusive old
boys network. In addition to being able to rub shoulders with future
billionaires, power brokers and possibly even presidents, if you belonged to a
Finals Club you got to spend weekendsat the best parties on campus
surrounded by the hottest girls. It was this last point in particular – meeting
girls – which appealed the most to Eduardo.
On a Tuesday night in the last week of October 2003, Mark and Eduardo went
out with a couple of Asian girls Eduardo had met. Mark struck out and went
back to his dorm room and opened up his Internet connection. He started
browsing his dorm’s online housing facebook – the database of student photos
browsing his dorm’s online housing facebook – the database of student photos
for all the students which stayed in the same dorm as him. Mark was also e-
mailing his friends and one of them suggested Mark should code a way of
comparing the facebook’s student photos to come up with a list of who’s hot
and who’s not. Another friend also suggested as a joke, you could compare
someone from the facebook with a farm animal which was also an idea which
appealed to Mark’s sense of humor combined with the fact he seemed to be
striking out with the opposite sex at that time.
By 11pm that Tuesday night, Mark had realized he would need more pictures
than his own dorm’s online database alone could provide if he was going to
make this “hot or not” concept work. The solution was simple – he would hack
into the Harvard University’s server and access the pictures from all the dorms
on the campus. By 4:00 am the next morning, Mark Zuckerberg had
downloaded thousands of pictures from Harvard’s dorms online databases to
his laptop computer. Mark had even decided on a domain name for his project
– he would call the site Facemash.com.
“Perhaps Harvard will squelch it for legal reasons without realizing its value as
a venture that could possibly be expanded to other schools (maybe even ones
with good-looking people). But one thing is certain, and it’s that I’m a jerk for
making this site.
Oh well. Someone had to do it eventually. Were we let in for our looks? No.
Will we be judged on them? Yes.”
– Mark Zuckerberg
About seventy-two hours later, Mark had Facemash.com up and running. It
was an elegant Web site which allowed users to compare pictures of two
undergraduate girls, vote for which one was hotter and then watch as
algorithms calculated mathematically who were the best looking girls on
campus. He e-mailed a few of his buddies to ask what they thought and
headed off to his classes. By the time he returned a few hours later, he found
word of Facemash.com had rapidly gone viral and in just under two hours,
Facemash.com had logged twenty-two thousand votes for the hottest girls on
campus.
“This wasn’t good. The link wasn’t supposed to go out like that. Mark had
wanted to get some opinions, maybe tweak the thing a bit. He’d wanted to
figure out what the legalities were of downloading all those pictures. Maybe
he’d never have launched it at all. But now it was too late. The thing about the
Internet was, it wasn’t pencil, it was pen. You put something out there, you
couldn’t erase it. Facemash was out there. In a matter of minutes, he killed the
damn thing, shutting it down. He had a feeling that he was in big trouble.”
– Ben Mezrich
2. The Winklevoss Twins
The results of Facemash.com’s brief existence over one afternoon were
genuinely impressive:
Almost every women’s organization on campus came out against the
Web site and expressed their disgust in no uncertain times.
The university’s computer science department was up in arms because
Facemash.com hogged all the university’s bandwidth.
The legality of someone having access to other people’s pictures to use in
this way was questioned.
The Crimson, the Harvard student newsletter, carried lurid details about
Facemash.com and its developer, Mark Zuckerberg.
Many of the girls who were featured on Facemash sent Mark e-mails of
complaint, letters and sometimes boyfriends across campus to get their
message across.
Therefore, it was no great surprise when Mark was called to appear before
Harvard’s ad board – the administration’s student disciplinary council. On the
day he appeared, the ad board was made up of three deans and a pair of
computer security experts. Mark readily admitted his guilt and apologized for
the controversy he had generated. To try and paint the episode in a more
positive light, Mark did point out to the board his actions had illuminated some
serious security flaws in Harvard’s computer system. To try and curry favor,
Mark Zuckerberg even volunteered to help the various student houses fix
some of these flaws in their computer systems. He also pointed out he had
shut the down immediately when he’d learned it had gone viral and that he
hadn’t meant anything malicious. If anything, Mark suggested it was more like
a beta test gone wild.
Perhaps influenced by Mark Zuckerberg’s obvious social awkwardness, the
deans decided not to expel him or even suspend him from Harvard. Instead,
Mark was placed on a form of probation and was warned he would need to
keep out of trouble for the next two years, or else. Mark wasn’t exactly sure
what the ominous sounding “or else” meant in practical terms but at least it
appeared like he was going to survive the Facemash incident without harm to
his academic standing. His reputation with his fellow students, on the other
hand, was another matter altogether. Mark thought if he had problems getting
girls to go out with him before, he was going to have a heck of a time dating
them now.
“Then again, people knew the name Mark Zuckerberg. The Crimson article
had made sure of that. The paper even followed up the initial article about the
Facemash debacle with an editorial about Facemash’s popularity, and how the
number of hits the site had garnered showed there was interest in a sort of
online picture sharing community – though maybe not one with such a
negative bent. Mark had certainly stirred up the pot – that was something,
wasn’t it?”
– Ben Mezrich
Soon after the Facemash debacle, Mark received an e-mail from some other
students at Harvard inviting him to come and work on one of their projects.
These students were identical twins Tyler and Cameron Winklevoss and Divya
Narendra who were seniors at Harvard. Almost everyone on campus knew of
the Winklevoss twins. For one thing, they were six-foot-five, blond athletes.
For another, they were members of the Harvard rowing team with aspirations
to make it to the Olympics. But it was generally the somewhat eerie fact they
were almost exact replicas of each other which stunned people who met them.
Their friend Divya Narendra was less well known at Harvard because he
wasn’t an athlete like the Winklevoss twins. Divya was more like their
business partner. All three of them were members of the Porcellian Club, the
most secretive Finals Club at Harvard. Members of the Porcellian Club were
renown for going on to great commercial success after graduation. The
Winklevoss twins and Divya Narendra had been working for two full years on
the business plan for launching a new startup they called “The Harvard
Connection”. The Harvard Connection was intended to be a Web site which
would put Harvard’s social life online and make it easier for guys and girls to
get together. It would be an online meeting place where Harvard students
could find each other, share information and connect. The only problem was
neither the Winklevoss twins nor Divya had the necessary computer skills to
put their Web site together.
After Mark Zuckerberg had achieved fame and notoriety with Facemash, the
Winklevoss twins and Divya decided to approach Mark and invite him to get
Winklevoss twins and Divya decided to approach Mark and invite him to get
involved in their Harvard Connection project. They sent Mark an e-mail:
“Hey Mark, I got your email from my friend. In any case, me and my team need
a web developer with php, sql, and hopefully java skills. We’re very deep into
developing a site, which we’d like you to be part of and a site which we know
will make some waves on campus. Please call my cell or write me an email
letting me know when you’d be free to chat on the phone and meet with our
current developer. This should be a really rewarding experience, especially if
you have an entrepreneurial personality. We’ll let you know the details when
you respond. Cheers. Divya Narendra. Cc: Tyler Winklevoss.”
Mark responded:
“I’m down to chat, but I need to deal with the aftermath of Facemash – so
maybe tomorrow? I’m definitely interested in hearing about your project.”
Tyler Winklevoss and Cameron Winklevoss did meet with Mark Zuckerberg
the next day (November 25, 2003) to talk about the Harvard Connection Web
site. They suggested it would only require about ten to fifteen hours work to
complete. Mark seemed to understand the idea straight away and appeared
enthused about the project, so they added what they thought would be a great
incentive for Mark:
“If the site is successful, we’re all going to make some money. But more than
money, this is going to be very cool for all of us. And we want you to be the
centerpiece of it all. This will get you back into the Crimson – but this time, the
paper is going to be praising you, not trashing you.”
– Tyler Winklevoss
3. The Genesis of Facebook
By the time Mark Zuckerberg and Eduardo Saverin got back to Harvard after
the two-week winter break of 2003, Mark was brimming with enthusiasm for
a new Web site he wanted to build. This new Web site would be an extension
of the Facemash experiment – an online social networking site which would be
very exclusive. People would be able to create their own profiles complete
with whatever pictures they wanted to upload. Users could then describe what
they were interested in and what they were looking for online – friendships,
love interest, whatever. Mark also suggested people could have the ability to
invite their friends to join as well.
“I’m thinking we keep it simple and call it TheFacebook.”
– Mark Zuckerberg
In many ways, Mark’s brainwave took the features of Friendster (which was
then already in use) and expanded on the idea so people could move their
entire social network onto the Web. TheFacebook would be an amalgam of
the best features of Facemash with the things Friendster already offered. It
also had some elements of Course Match, an earlier project Mark had worked
on which allowed students to see what classes other students were taking.
Eduardo liked the idea immediately.
“Eduardo wondered when the genius moment had struck – when Mark was
home, in Dobbs Ferry, over the holidays? While he was sitting alone in his
dorm room, staring at his computer screen? In class? The one place he was
pretty sure Mark didn’t have the stroke of genius was while hanging out with
the Winklevoss twins. Mark had described the dinner meeting in full detail, as
well as the site the Winklevosses thought Mark was working on for them. The
way Mark had described it, it was little more than a dating Web site, a place
for guys to get laid. A sort of highbrow Match.com. As far as Eduardo knew,
Mark hadn’t actually done any work for the twins. He’d looked at their site,
thought it through – and decided it wasn’t worth his time. In fact, he’d scoffed
at it, saying the even his most pathetic friends knew more about getting
people interested in a Web site than Divya and the Winklevosses.”
– Ben Mezrich
– Ben Mezrich
Mark asked for some start-up money from Eduardo to rent the servers and to
get the Web site online. Eduardo agreed to provide $1,000 to start the ball
rolling, and the two friends decided they would split the company seventy-
thirty with seventy percent to Mark. They even talked grandly about Eduardo
becoming the company’s first CFO.
“Eduardo nodded. It sounded fair. It was Mark’s idea, after all. Eduardo would
finance it, and make the business decisions. Maybe they’d never make any
money off the thing – but Eduardo had a feeling it was too good an idea to just
fizzle away. Kids all over campus were trying to build Web sites. Eduardo
personally knew a dozen other students who were trying to launch online
businesses from their dorm rooms. Lots of them had social aspects like the
Winklevosses’ site – but none of the ones Eduardo had heard of were anything
as cool-sounding as Mark’s idea. Simple, sexy and exclusive. TheFacebook had
all the elements of a successful Web site. A simple idea, a sexy function
– and an exclusive feel.”
– Ben Mezrich
Although Mark was starting to work intensively on his own Web site, for one
reason or another he continued to give the Winklevoss twins and Divya the
impression he was still enthused about and working on their Web site as well.
He exchanged more than fifty e-mails and talked with them at least a half-
dozen times on the phone. As the weeks went by, the twins were getting
anxious because no progress had been made. When Mark did finally meet
with them in person in mid-January, he talked about server problems and
problems with some “front-end stuff”. The Winklevosses assumed he was
getting a little burned out and decided they would look for a new programmer
if Mark didn’t get his act together in the next month or so.
Of course, unbeknown to them, Mark was hard at work on his own project,
TheFacebook. The domain name was registered on January 12, 2004 and
Mark had lined up hosting for $85 a month. By early February 2004, Mark was
skipping classes in order to finish coding for TheFacebook. He developed a
simple and clean looking opening screen for the Web site which described it
quite well: