Fired Facebook Acquisitions Exec Lands at Twitter
Mike Brown, the former Facebook corporate development executive who was dismissed for buying its stock on secondary markets, has taken a similar job at Twitter. — Brown, who had helped negotiate many of Facebook's so-called …
Context & Ripple Effects
Facebook fired corporate development executive Mike Brown for buying its own stock on secondary markets — a confirmed dismissal reported May 1-2, 2011, landing awkwardly just as people who saw Facebook's financials say its growth is running ahead of forecast, stoking unconfirmed talk of an IPO as early as spring 2012. Brown had helped negotiate many of Facebook's acquisitions.
Twitter hires him into a similar corporate development role within days, while it is itself rumored (status: unconfirmed) to be closing a $40-50 million cash-and-stock acquisition of TweetDeck. The hire comes during a busy stretch for Twitter's business side: sponsored text-ads launched April 29, VP Katie Stanton put international traffic at 70% of total, and the platform carried the first credible reports of Bin Laden's death.
First-order effects
- Twitter gains an executive trained inside Facebook's acquisition machine at the exact moment its rumored TweetDeck deal would be his first test; Facebook loses a veteran of the negotiations behind its own acquisition record heading into a period of faster-than-forecast growth.
Second-order effects
- Brown's firing over secondary-market share purchases puts every pre-IPO company's insider stock-trading policy under scrutiny, raising compliance costs around employee access to hot private shares just as demand for those shares accelerates.
Third-order effects
- Corporate development stops being back-office staffing and becomes a competitive front between the social platforms: as both companies scale toward public markets, each builds deal teams poached from the other, and the fight for acquisitions, talent, and clean pre-IPO governance tightens together.
The trend: As Facebook and Twitter scale toward IPOs, corporate development talent is becoming a contested asset between the two platforms, with secondary-market stock practices forcing governance reckoning inside private companies.