Facebook Names Former YouTube Finance Chief as New CFO
Fast-growing social network site Facebook named former YouTube Chief Financial Officer Gideon Yu as its new CFO, replacing prior finance chief Michael Sheridan, in the latest step toward a potential IPO.
Yu, 36, became chief financial officer of video-sharing sensation YouTube in September of last year, shortly before the company was acquired by Google in a $1.65 billion deal.
The Palo Alto-based start-up, which has rebuffed potential acquirers among top Internet players in favor of remaining an independent company, did not disclose the reasons why Sheridan, a veteran Silicon Valley executive, was leaving Facebook.
Facebook officials declined to comment on the changes.
The company, which was started in 2004 by then-undergraduate Mark Zuckerberg, now 23, as a social site for fellow Harvard University students, has opened up over the past year to users of all ages.
Facebook, which allows users to share their online activities with a circle of friends on personal Web profile pages, said it had 30 million active members earlier in July, up from 24 million less than 2 months earlier.
Prior to joining YouTube, Yu was treasurer of Yahoo
Previously, Sheridan was chief financial officer of IGN Entertainment, a gaming site that was acquired by News Corp.
Earlier this month, Facebook named Chamath Palihapitiya, 30 an investor with venture capital firm Mayfield Fund LP, as Facebook's vice president of product marketing and operations. Prior to joining Mayfield in 2005, Palihapitiya was general manager of AOL's AIM and ICQ instant messaging businesses.
The company has become a darling of Silicon Valley trend-watchers who see the site becoming a major player in the Internet industry, "the next Google" in the shorthand of some analysts here.
"Facebook has captured everyone's imagination," said Greg Sterling, an Internet analyst with Sterling Market Intelligence.
"The anticipation is either that it's going to be a takeover target bigger than YouTube or that its going to have a hot IPO like Google," he said.
Two weeks ago, Facebook board member and financial backer Jim Breyer, a partner at venture capital firm Accel Partners, said the company would do well over $100 million in revenue in 2007, turn a profit, and have significant positive cash flow.
At that time, Breyer sought to knock down increasingly wild rumors that the company may be for sale -- with recent speculation centered on Microsoft, which Web pundits said might be considering a $6 billion offer for Facebook.
In the past it has fended off lower bids from Yahoo and Viacom.
"We continue to focus on building the best stand-alone company we can, and simply said, are not for sale," Breyer said.
Instead, sources close to the company say Facebook is looking to build toward an eventual initial public offering.
One hurdle it faces is a lawsuit that accuses Zuckerberg of stealing the idea for Facebook from fellow students at Harvard who had hired him to create a site called Harvard Connection in late 2003, according to court documents filed in the long-running dispute. A hearing in that case takes place in U.S. federal court in Boston on Wednesday.