Meta’s Failure to Capture the Metaverse is Reflecting in Zuckerberg’s Bank Balance
Zuckerberg loses a staggering amount of money after Meta’s failed attempts to dominate the metaverse
It’s no secret that Meta-formerly-Facebook’s CEO Mark Zuckerberg’s metaverse pivot isn’t precisely paying off yet. Mark Zuckerberg’s wealth has seen a downfall by nearly US$7 billion in a few hours, knocking him down a notch on the list of the world’s richest people, just after a whistleblower came ahead and the outages took Facebook Inc.’s flagship products offline.
A selloff redirected the social media giant’s stock to drop by around 5% on Monday, adding to the decreasing value by 15% since mid-September. The stock slumped on Monday taking Zuckerberg’s worth down to US$120.9 billion, bringing him down from Bill Gates to No. 5 on the Bloomberg Billionaires Index. He’s lost about US$19 billion of wealth since Sept. 13, when he was worth nearly US$140 billion, according to the index. On Sept. 13, the Wall Street Journal started publishing a series of stories based on a cache of internal documents, disclosing that Facebook was aware of a wide range of problems with its products — such as Instagram’s harm to teenage girls’ mental health and misinformation about the Jan. 6 Capitol riots — while downplaying the matter in public. The reports have hacked the attention of government officials, and on Monday, the whistleblower revealed herself.
In response, Facebook has said that the issues facing its products, including political polarization, are complex and not caused by technology alone. “I think it gives people comfort to assume that there must be a technological or a technical explanation for the issues of political polarization in the United States,” Nick Clegg, Facebook’s vice president of global affairs, told CNN.
Facebook’s highest valuation in recent, September 2021, happens to coincide with the month before Zuckerberg declared the company’s name change and pivoted to the metaverse. Since then, only Zuckerberg has doubled down on the concept, which has so far materialized only as a desolate and much-lampooned virtual playground that needs the company’s own clunky virtual reality hardware to visit. In other terms, it is no wonder investors have shown a negative response to Zuckerberg’s zillion-dollar bet. Some experts feel that Zuckerberg is taking Meta down with him. “Mark Zuckerberg’s poor leadership skills are slowly dragging Meta toward failure, a Harvard expert also mentioned. “I think Facebook is not going to do well as long as Mark Zuckerberg is present there,” senior Harvard Business School fellow Bill George told CNBC last week. “He’s likely one of the reasons so many people are turning away from the company. It seems he has really lost his way.”
The result is that the company’s finances are in scraps. Bloomberg called Meta’s recent earnings reports “dismal,” with TikTok sneaking users from Meta’s Instagram left and right. Zuckerberg has really shackled himself to the fate of Meta. The huge majority of his net worth is tied up in the company’s stock — and he infamously holds hundreds of millions of shares, providing him immense power over the company that he founded. It remains an unseen matter whether Zuckerberg will be able to prove investors’ decisions incorrect and turn his vision for the metaverse into a meaningful new direction for Meta. His next shot? Next month’s release of the company’s new VR headset.