I’ve made it pretty clear that FB is one of my favorite stocks for the coming few years.  I think they have the biggest runway of opportunities for growth and like the fact that many things appear open ended.  If I can think of areas they could add value, I’m sure the number of opportunities they know they could create added value are even more immense.  I am also impressed that they went through a very difficult period with a bad IPO (at least for the public – the company and shareholders did great!) and the transition to mobile.  From a personal perspective, I know I’ve grown the most not when times are great, but when times are tough.  That is when true character and experience are formed.  So that’s good.  I like the management team.

As a former tech fund manager, I often forget that I may have an opinion worth sharing.  On that front, I think these years will be looked at similar to the transition from DOS to Windows in the PC era, marketed by what I will term “subnet” experiences.  By this, we will move to an era where users identify specific internet brands with their first point of customer contact.  No longer will they Google everything and see a DOS like report of sites that might interest them, but if they are shopping they will go to Amazon or Ebay, if socializing FB, if professionalizing perhaps LinkedIn.  Like history, certain leaders are materializing to serve certain aspects of our lives.  GOOG took us through the Wild West Frontier, but now some towns are being developed in the FB, AMZN, LNKD spaces.

Maybe a way to think about value is to think about what portion of a typical day you typically spend in each “subnet experience;” how much time do you work, how much time do you shop, how much time do you socialize?  The bubbles of opportunity may correlate within each of those real estate properties.  Google will still be relevant and may ebb and flow in relevance based on the integrity of the towns and what they offer.  It is more difficult, however, to see where GOOG fits in than where it used to be and this transition could very well resemble how Microsoft felt about the launch of the internet.  Bill Gates was all over that transition with Internet Explorer and handled it well, representing the undoing in Netscape.  But they haven’t transitioned well ever since.

Right now, you use GOOG if you are looking for something.  But, the more you have an idea for what you are looking for on your own and the brands that could satisfy those needs (i.e. I need shoes and Nike is the brand), you will increasingly go to the “subnet” that provides the greatest ease and convenience.  (I trust AMZN on price and offering so I will go their first.)  My friends are on FB and they may be a better place to check on cool new restaurants in the area.

GOOG has properties to be sure, but less destinations in terms of time spent using them.  They are moving but are often second movers in many things except search.

Broadleaf Partners, LLC owns or may own positions in FB, GOOG, AMZN, LNKD, and EBAY.  Thoughts that we share in this environment are not to be construed as a recommendation to buy or sell the securities in these or any other companies.  We reserve the right to change our opinions and thoughts on these companies at any time in the future, with or without subsequent notice.  The advantage of an internet based environment for sharing ideas is that we can more efficiently do so in two directions.  To that end, we would welcome your thoughts and opinions on anything that we post, but also reserve the right to edit any content that we deem inappropriate.  Thanks for your interest in Broadleaf Partners.