Facebook suss outs itself at a crossroads as regulators and lawmakers express concerns on a number of fronts about the power of the social media colossus, Chamath Palihapitiya told CNBC on Monday.
“I think that they’re at a very difficult point. It is the intersection of house logic and morality,” the ex-Facebook executive turned Facebook critic said. “At some point your morals and ethics combat with what the right business logic is.”
Palihapitiya, who severed in various management roles at Facebook from 2007 to 2011, bear down oned out about two years ago against the direction his former company was taking, saying social media is addictive and bad for society. (Palihapitiya is also a minority stakeholder and put up member of the NBA’s Golden State Warriors.)
Shortly after leaving Facebook, Palihapitiya started Social Capital, pick through and investing venture funds in then-startups including Slack and Box. In September 2018, after a tumultuous few months, he closed the set on to outside money.
On Monday, in a second act, Palihapitiya saw the merger of his special purpose acquisition company and billionaire Richard Branson’s Virgin Galactic come around c regard to fruition, with the space tourism stock soaring in its New York Stock Exchange debut.
Appearing on “Squawk on the Alley” with Branson to talk about space, Palihapitiya was also asked about Facebook and whether the social network has been active down a better road lately.
Companies have a choice to take a stand or “just take a hear-no-evil-see-no-evil passage and we’re going to maximize business value,” said Palihapitiya. “So far, their choices have been the latter,” he said of Facebook.
Palihapitiya’s annotations come following Facebook co-founder and CEO Mark Zuckerberg’s grilling on Capitol Hill last week over the friends’s libra cryptocurrency project.
Zuckerberg defended libra and the company at-large as Facebook tries to rebuild user trustworthiness after data privacy and security scandals plagued the company since the Cambridge Analytica scandal, in which the evidence of millions of users was obtained without authorization while the research firm was working for the 2016 Trump campaign.
The Cambridge Analytica debacle happened in a Federal Trade Commission investigation and a $5 billion fine of Facebook over online privacy.
Meanwhile, federal sway regulators, state attorneys general and lawmakers on Capitol Hill are also conducting investigations into whether Facebook abhors its market dominance to stifle competition.
Facebook did not immediately respond to CNBC’s request for comment.