It is only a matter of hours before Facebook starts trading on the NASDAQ stock exchange under ticker symbol, FB. Mark Zuckerberg, its 28-year-old founder is worth $18 billion at the IPO price and if predictions turn out to be true, he be worth many times more.
The recent (and quick) monetary success of companies like Groupon makes one wonder how one motivates a new breed of engineers to think about the innards of today’s technology — chips, optical components and other unsexy stuff.
It is something on my mind for a while, and Mark Sue, an analyst with RBC Securities (a brokerage) summed it up well, when (in a note to his clients this morning) he wrote:
Should your child study their hardest and get a Masters Degree in Engineering or should they party hardy at a liberal arts school, study marketing and get a job at Yelp or a social networking start-up? Hit the thick text books and figure out optical dielectric multilayer waveguides and photo refraction or weigh in on opinions on hair salons, pedicures and lawn irrigation?
The path to success may be different, but the opportunities for some reason seem to be more in favor of the latter than the former. For all the PhDs that the optical companies hire to make their products better, it seems they can barely squeeze out 5% operating margins.
Meanwhile the lack of capital intensity can make reviewing products and services on the web more lucrative. Now some of that is related to the optical segment’s industry structure which needs to consolidate but like they say, sometimes it’s better to be lucky than to be smart.
While Sue talks about kids, I know many of my pals from the old infrastructure business have decided to opt for the new social-mobile web and are trying to build apps and stuff. By the way, I don’t really have answers to my own questions so chime in with your theories.