Facebook, the world’s largest social networking site, is owned by Meta Inc. (formerly Facebook Inc.). Mark Zuckerberg founded the company in 2004 with several Harvard classmates. As of January 2024, Zuckerberg remains the majority shareholder, owning about 13% of Meta.
While Meta has acquired many companies over the years, Facebook continues to be its flagship product. The company changed its name to Meta in 2021, reflecting Zuckerberg’s vision to expand beyond social media into the “metaverse.” Despite this rebranding, Zuckerberg continues to serve as the CEO and chairman of Meta, maintaining significant control over the company’s direction.
Zuckerberg’s position gives him considerable influence over a platform used by billions of people worldwide. His Facebook profile has over 120 million likes, showing his continued public presence as the face of the company he created.
Key Takeaways
- Mark Zuckerberg founded Facebook in 2004 and remains the majority shareholder with 13% ownership of Meta.
- Facebook is owned by Meta Inc., which also owns other popular platforms like Instagram and WhatsApp.
- Despite Meta’s expansion and rebranding, Zuckerberg maintains control as CEO and chairman of the company.
Ownership and Management History
Facebook’s ownership structure has evolved significantly since its founding in 2004. The company has transformed from a small college project to a global tech giant with billions in market value, all while its founder maintained significant control.
Founding and Early Investments
Facebook began in Mark Zuckerberg’s Harvard dorm room in 2004. Zuckerberg initially owned the largest stake, with co-founders Dustin Moskovitz, Eduardo Saverin, and others holding smaller portions.
The first major outside investment came in 2005 when Jim Breyer and Accel Partners invested $12.7 million for approximately 15% of the company. This early deal valued Facebook at around $98 million.
In 2007, Microsoft made a strategic investment of $240 million for a 1.6% stake, valuing Facebook at $15 billion. This investment wasn’t just about ownership but established an important advertising partnership between the companies.
Digital Sky Technologies became another significant early investor, putting in $200 million in 2009 for a 1.96% stake. These early investments diluted the founders’ ownership but provided crucial capital for growth.
The Road to IPO
Facebook’s path to becoming a public company involved several funding rounds that brought in institutional investors while gradually diluting early shareholders’ stakes. However, Zuckerberg carefully structured deals to maintain voting control.
The company implemented a dual-class share structure before its IPO. This gave Class B shares (primarily held by Zuckerberg) ten times the voting power of Class A shares sold to the public.
Facebook finally went public on May 18, 2012, in what was then the largest tech IPO in history. The offering raised $16 billion and valued the company at $104 billion. Despite the size of the IPO, Zuckerberg retained a 22% ownership stake and controlled approximately 57% of voting shares.
The IPO faced early challenges with technical glitches and a falling share price, but established Facebook as a publicly traded company accountable to shareholders.
Key Shareholders Over Time
Mark Zuckerberg has consistently remained Facebook’s largest individual shareholder. As of 2020, he owned approximately 29.3% of Facebook’s Class A shares, worth over $54 billion.
Co-founder Dustin Moskovitz has maintained a significant stake despite leaving the company in 2008. Eduardo Saverin’s ownership percentage decreased following disputes with Zuckerberg, though he still benefited substantially from the IPO.
Institutional investors like Vanguard Group, BlackRock, and FMR have become major shareholders post-IPO, collectively owning substantial portions of the available shares.
Despite the entry of these large institutional investors, Facebook’s special share structure ensures Zuckerberg maintains firm control over company decisions. This ownership model has allowed him to guide Facebook’s strategic direction through acquisitions and expansions while facing minimal risk of losing control.
Current Ownership Structure
Facebook, now operating under the parent company Meta, has a complex ownership structure dominated by a few key individuals and institutions. The company’s unique share class system allows certain stakeholders to maintain control while ownership is distributed among various groups.
Majority Stakeholders
Mark Zuckerberg remains the most influential shareholder of Facebook, holding approximately 13.5% of shares. However, his actual control of the company is much greater due to Facebook’s dual-class share structure.
Zuckerberg owns special Class B shares that carry 10 votes each, compared to regular Class A shares with just one vote. This gives him controlling interest in the company.
Other significant individual stakeholders include co-founder Dustin Moskovitz, who holds about 11.4% of Facebook shares. Former COO Sheryl Sandberg and former Chief Product Officer Christopher Cox also maintain substantial holdings in the company.
Institutional Investors
Large financial institutions own significant portions of Facebook’s publicly traded shares. The Vanguard Group stands as one of the largest institutional shareholders of Facebook, managing substantial investment funds on behalf of clients.
BlackRock Inc., another investment management corporation, holds a major stake in Facebook. Through various index funds and ETFs, BlackRock gives everyday investors exposure to Facebook stock.
FMR LLC, better known as Fidelity Investments, rounds out the top three institutional investors. These large institutions typically own Class A shares, which have less voting power than Zuckerberg’s Class B shares.
These institutional investors gained their positions primarily after Facebook’s 2012 IPO, when the company first offered shares to the public.
Public Shareholders
Since Facebook’s IPO in May 2012, millions of individual investors worldwide have purchased shares. The company’s public offering was one of the largest in technology history, though initially controversial due to technical glitches and valuation concerns.
Public shareholders mostly own Class A common stock with limited voting rights. This structure was deliberately designed during the IPO to ensure Zuckerberg and early investors maintained control.
Despite holding less influence over company decisions, public shareholders have benefited from Facebook’s tremendous growth. Many individual investors hold Facebook shares through retirement accounts, mutual funds, or ETFs rather than directly.
Small investors can purchase Facebook shares through regular brokerage accounts, though they represent a tiny fraction of ownership individually.
Privacy Policies and User Data
Meta, Facebook’s parent company, has developed extensive privacy frameworks that govern how user information is collected and utilized across their platforms. These policies have evolved significantly over time, especially in response to regulatory changes and public concerns about data protection.
Handling of Personal Data
Facebook collects a wide range of user data to support its services including Facebook, Instagram, and Messenger. This includes information you provide directly, like your name and photos, as well as data about your activities on the platform.
The company may share information internally within their family of companies or with third parties for purposes described in their policy. This data sharing helps them improve services and target advertisements more effectively.
Facebook has faced numerous privacy concerns over the years. These issues stem partly from the company’s revenue model, which relies heavily on targeted advertising based on user information.
They track not only their users but also non-users on other websites and apps. They’ve also collected biometric facial data without explicit “opt-in” consent in some cases.
Cookie Policy Explained
Facebook uses cookies and similar technologies to track user activity both on and off their platforms. These small text files help Facebook recognize your device when you return to the site.
The cookie policy allows Facebook to:
- Remember your login status and preferences
- Show relevant ads based on your browsing history
- Analyze how you interact with their services
- Track your activity across other websites with Facebook plugins
Third-party cookies enable Facebook to gather information about your online activities even when you’re not using their services. This cross-site tracking helps build detailed user profiles for advertising purposes.
Users can manage cookie settings through their browsers, but completely blocking Facebook’s tracking technologies may impact some functionality on the platform.
User Consent and Preferences
Facebook provides tools for users to manage their privacy preferences, though finding and using these settings can sometimes be challenging. The platform offers options to:
- Control who can see your posts and profile information
- Manage targeted advertising preferences
- Download your personal data
- Limit data collection in some cases
The company has stated they are committed to data protection, particularly in compliance with regulations like GDPR. However, critics argue that the default settings often favor data collection over privacy.
Facebook’s approach to consent has evolved, with the platform now providing more explicit information about how data will be used. Still, many users accept terms without fully understanding the implications for their personal information.
Advertising and Revenue Generation
Facebook (owned by Meta) generates most of its income through advertising. The platform uses sophisticated targeting methods and measurement tools to provide value to advertisers while tracking user engagement.
Personalised Advertising Model
Facebook’s advertising system is built on personalization. The platform collects user data including demographics, interests, and online behaviors to help advertisers reach specific audiences. This targeted approach generates over $160 billion in ad revenues annually for Meta.
Advertisers can select audiences based on detailed parameters like age, location, interests, and even past purchasing behaviors. This precision targeting is why many businesses choose Facebook’s ad platform.
The system uses cookies and similar technologies to track users across the internet, building detailed profiles that help deliver relevant ads. This personalization creates higher engagement rates and better returns for advertisers.
Content Measurement Techniques
Facebook employs advanced measurement tools to track how users interact with content. These tools analyze engagement metrics such as:
- Click-through rates
- View duration
- Conversion actions
- Engagement rates (likes, comments, shares)
The platform provides advertisers with detailed dashboards showing how their ads perform in real-time. This allows for quick optimization and better allocation of ad budgets.
Facebook’s measurement systems can track user journeys from initial ad impression to final purchase, even if that purchase happens days later. This attribution capability is valuable for advertisers trying to understand their marketing effectiveness.
Audience Research Practices
Meta conducts extensive audience research to improve its advertising capabilities. The company analyzes user behavior patterns to create detailed audience segments that advertisers can target.
These research practices include monitoring content preferences, device usage, and platform engagement. This information helps create more effective ad products and targeting options.
Facebook’s audience insights tools allow advertisers to discover new potential customers based on similarities to their existing customers. This “lookalike” targeting is particularly powerful for expanding customer bases.
The platform continuously tests new audience research methods, including AI-powered behavioral analysis. This commitment to research helps maintain Facebook’s position as a leading advertising platform.
Facebook’s Security Measures
Meta (Facebook’s parent company) has implemented comprehensive security measures to protect users and their information. These protections span across data security, abuse prevention, and location data safety.
Protection of User Data
Meta has invested significantly in safeguarding user information. The company invested $8 billion in its privacy program over the past six years, showing their commitment to data protection.
Their approach includes:
- Physical security: Limited access to data centers for authorized personnel only
- Encryption: Protecting data in transit and at rest
- Privacy controls: Tools that allow users to manage their privacy preferences
Meta also maintains data security terms that outline how they handle user information. They comply with regulations like GDPR, which protects European users’ data rights.
Following a major settlement, Facebook faced a $5 billion penalty from the FTC – one of the largest government penalties ever for privacy violations. This led to stricter internal controls.
Dealing with Abuse
Meta employs both technology and human reviewers to address platform abuse. Their systems work to identify and remove harmful content before users see it.
Key abuse prevention measures include:
- AI-powered detection tools that spot potential violations
- Community reporting options for flagging problematic content
- Content moderation teams working 24/7 across multiple languages
The company regularly publishes transparency reports detailing their enforcement actions. These reports show how many pieces of content were removed and for what reasons.
Meta also partners with external fact-checkers to combat misinformation. They reduce the distribution of content marked as false and notify users who have interacted with it.
Geolocation and Search Data Security
Meta collects location and search data to personalize user experiences but has implemented safeguards for this sensitive information. Users can control what location data is collected through device and app settings.
Their privacy policy outlines how they handle this information:
- Search history can be reviewed and deleted by users
- Location history can be turned off or limited
- Targeted advertising based on location can be adjusted
For added security, Meta anonymizes certain location data after specific time periods. They also provide transparency about what information is being collected and how it’s used.
Regular security audits help ensure that geolocation and search data remains protected from unauthorized access or breaches.
Online Presence and Integration
Facebook’s vast online presence has transformed how people connect across the internet. The platform has expanded beyond its original social networking purpose to become deeply woven into the digital landscape through strategic acquisitions and partnerships.
Integration with Other Sites
Many websites now feature Facebook login options that let users skip creating new accounts. This makes signing up faster and brings your profile info along too.
Sites can also include Facebook’s “Like” and “Share” buttons, letting visitors interact with content without leaving the page.
Businesses often embed Facebook posts or feeds directly on their websites. This keeps their content fresh without manual updates.
The Facebook Pixel, a special tracking code, helps businesses follow user behavior after clicking ads. This creates a seamless experience between Facebook and external sites.
Facebook’s integration extends to mobile apps too. Developers can add Facebook features using special tools called SDKs. These connections help Facebook collect data and understand user habits across the internet.
Facebook vs. Other Social Services
Meta’s platforms (including Facebook) face strong competition from other social services.
Twitter offers real-time, public conversations with a simpler interface and shorter posts. It attracts news followers and public figures for quick updates.
Instagram (also owned by Meta) focuses on visual content and attracts younger users. TikTok has become Facebook’s biggest rival with short videos and an algorithm that quickly learns user preferences.
LinkedIn targets professional networking, while Snapchat pioneered disappearing content. Each platform has carved out its own space in the social media landscape.
Facebook’s advantage comes from its massive user base and detailed demographic data. This gives advertisers powerful targeting options that smaller platforms can’t match.
The Facebook Ecosystem
Mark Zuckerberg’s company has built a connected network of apps and services.
Beyond the main Facebook app, the ecosystem includes:
- Instagram – photo and video sharing
- WhatsApp – messaging and calls
- Messenger – chat and business communication
- Oculus – virtual reality hardware
- Portal – video calling devices
These services share technology and data behind the scenes. When you create a profile on one platform, that information helps personalize your experience across others.
The Meta rebrand in 2021 unified these services under one company identity. This move signaled the company’s focus on building a “metaverse” – a connected virtual world beyond individual apps.
Meta’s ambitious vision aims to make its platforms essential to daily digital life. By connecting services through shared login systems and cross-platform features, Facebook has created a powerful ecosystem that’s hard for users to leave.
