Facebook investor unhappy with Zuckerberg’s Meta ambitions

A high-profile investor in Facebook is publicly displeased with Meta CEO Mark Zuckerberg’s push into the metaverse.

Brad Gerstner, the Bay Area-based founder of tech investment firm Altimeter Capital, wrote a (relatively) fiery open letter calling for Zuckerberg to pull back on the all-in investments in the whole Meta thing — and conduct mass layoffs.

“Like many other companies in a zero rate world — Meta has drifted into the land of excess — too many people, too many ideas, too little urgency,” Gerstner wrote in a Medium post published Monday. “This lack of focus and fitness is obscured when growth is easy but deadly when growth slows and technology changes.”

The callout comes amid economic headwinds in the tech industry, with industry heavyweights (including Salesforce co-CEO Marc Benioff) suggesting a lean period for tech. But the economic situation is particularly dire for Meta, which is investing $10 billion to $15 billion a year on its assorted metaverse experiments, including Horizon Worlds, virtual and augmented reality and the Meta Quest goggles. The company’s stock has declined by nearly 60% so far this year. (It also does not help that previews of the metaverse—staged legacies and all—have been poorly received.)

Gerstner argues, “Meta needs to re-build confidence with investors, employees and the tech community in order to attract, inspire, and retain the best people in the world.”

His key suggestions: pull back on the metaverse investments and pump a maximum of $5 billion — in itself a staggering number — with “more discrete targets and measures of success.” “An estimated $100B+ investment in an unknown future is super-sized and terrifying, even by Silicon Valley standards,” Gerstner added.

And, in line with what other, smaller companies have been doing for the past few months, reduce staffing costs by 20%, including through layoffs, which he argues “merely takes the company back to mid-2021 levels of employee expense.” (He does acknowledge the impact this will have on employees, but says that “these employees will find replacement jobs and quickly be back to work.”)

CNBC reports that Altimeter owns more than 2 million shares of Meta. According to an interview Gerstner did earlier this year, Altimeter invested in Facebook in 2012, shortly after the company launched its IPO.

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