Friday, 26 April 2013

The Social Network: Movie Review

I often review financial books in order to help readers of this blog cut through a lot of the junk that is out there.  I also occasionally review movies - I don't think they are even nearly as educational as books but people often learn from movies so it is often worth looking at.

The Social Network may seem like a strange choice for movie to be reviewed on this blog and I watched it more for entertainment purposes than to learn anything.  However it was fascinating and had a couple of lessons for would be business people and entrepreneurs which I will cover in this post.

I was surprised at how much this movie made me think and re-evaluate the way in which I had done business.  I have not yet created a successful business and although I had put my business plans on hold last year I am starting to explore options relating to this again.

The Social Network: Movie Summary (no spoilers)

I will obviously let you watch it for yourself but this movie offers a fictionalized account of the founding of Facebook.  It goes through the motivations for the founding of Facebook as well as the way in which the idea was conceived and developed.

The story is told from 3 perspectives:
  • Mark Zuckerberg: The founder of Facebook who is defending two legal suits in relation to the founding of Facebook  
  • Eduardo Saverin: The co-founder and former CFO of Facebook who is suing Zuckerberg for pushing him out of the company and making his shares worthless
  • The Winklevoss Brothers: Brothers who are suing Mark Zuckerberg claiming that he stole their idea for Facebook after they hired him to program a very similar site
The movie is centered around the discovery process associated with the litigation and the depositions of the parties above.  It is a particularly interesting way to approach the movie and I thought it allowed the director to really engage with the issues while describing background information through the lawyers questions and discussions.

Lessons that viewers can take from The Social Network

Obviously the lessons I am going to be focusing on center around the business aspects of this movie.  Some of the core lessons that I took from it include:

  • The necessity of setting up iron clad legal agreements when going into business with partners, even if they are your closest friends
    • Going into business with your best friend is much like moving in with them (in my view), there are certain benefits to it however when things go bad the issues are much more complicated than they would be with a stranger
    • It really highlights then necessity for people going into partnership to have an ironclad agreement covering the way in which the business is going to work, how disputes are to be resolved and how any break up of the partnership should work
  • The pains that a business faces when growing especially when partners want to take it in different directions
    • When a business grows rapidly, partners will often have different ideas about where the business should go
    • If you are not the controlling partner in a business arrangement keep in mind that you may have no control and no say in the end about where the business will end up and you may find yourself more and more marginalized in the business
  • The benefits and downsides of using venture capitalists and other investors
    • Investors in your business are great but they come with risks and expectations
    • Venture capitalists are ruthless and have no qualms about getting rid of management and cutting out the founders of the business if they believe it is in their best interests
    • They provide a very valuable service and they cash and validation they give is immeasurable but business owners and entrepreneurs should never make the mistake of thinking that they are working in anyone but their own best interests
  • The dangers of success
    • This was an interesting aspect of this movie and one that is not covered often enough
    • Hollywood loves portraying the 'success story' but never shows the downside of this success, the false friends and those who do what is only in their best interests
    • The Social Network is worth watching for this aspect alone.
You May Also Be Interested In:

1 comment:

  1. Hello 90 million blogger,

    Could you please provide me with some insight on my situation that I described in the comments here:

    Thank you!