Young CEOs: Are They Up to the Job?
Facebook Inc.’s move to the public markets will be accompanied by plenty of superlatives. But no aspect of the company is as exceptional as the age of its founder and chief executive, 27-year-old Mark Zuckerberg.
Only four executives under the age of 40 took command of Standard & Poor’s 500 companies between 2004 and 2008, according to a study by recruiters Spencer Stuart. In 2010, the average age of incoming CEOs at S&P 500 companies was 52.9, down from 54.7 in 2006, the Conference Board, a business-research group, says. The technology business has ushered a number of young executives into their company’s top job in recent years, including 38-year-old Google Inc. CEO Larry Page. Eight of the 42 technology and Internet companies that held initial public offerings in the U.S. in 2011 were led by CEOs who were under 40 at the time, according to a review of data from capital-markets data firm Dealogic.
Mr. Zuckerberg has tried to grow up in more obvious ways as well. He has traded in his trademark Adidas flip-flops for Brooks running shoes and put on a coat and tie when President Obama visited in April. From his earliest days in Silicon Valley, he has also sought introductions to more seasoned CEOs, including Intel Corp.’s Paul Otellini and Microsoft Corp.’s Bill Gates, for advice on how to run a company. In an interview with The Wall Street Journal in October, Mr. Zuckerberg said the biggest lesson he has learned from running Facebook for the past eight years is how to manage teams and incentivize employees. “We’re getting really good at figuring out what types of people are going to be able to do different types of things,” he said. “That’s not something I had any experience doing when we were scaling up from a company of 50 to 100 people to where we are now.”
Not having the experience “of having tried things and had them fail” freed him to think differently about the children’s apparel chain, he said. But it also left him unprepared when he was confronted with having to shut down Janeville, an unprofitable women’s brand, just six months after he took the job.
“I had never run an entire business, nor had I ever shut down an entire business,” he said. “If I had seen it before, I would have known what to expect and it would have been easier.”
Mr. McCauley summoned his top lieutenants, described Janeville’s problems and requested their solutions. The executives agreed the line needed to be shut down, causing 109 people to lose their jobs. “I learned from that experience that I never wanted to lay anybody off again,” Mr. McCauley said.