It’s not often I can say I have something in common with an investment bank - payday lenders are more likely company. But the misfortunes of UBS with the Facebook IPO reminded me strongly of my own experiences with the social network.
In case you hadn’t heard about it, the Swiss investment bank submitted a request for Facebook shares via the Nasdaq trading system. It didn’t get a response, so submitted another request. And then another. And possibly more - the bank isn’t saying - since it ended up with substantially more shares than it wanted. As a result, UBS is facing a possible loss of £226 million because of its excess share holding in a flotation that has made a damp squib look like an Olympics fireworks display.
It is one of many investors which had problems with the exchange during the flotation. As it all happened in the United States, law suits will inevitably follow.
My own experience was on a much smaller scale. Looking for speakers for last year’s Futures conference, I filled out the detailed information requested on Facebook’s page dedicated to such requests. On submitting this, I got an error message relating to the Captcha system which filters out humans from robots. Unfortunately, the error recurred multiple times as I repeatedly tried to get the system to accept the code. Eventually I gave up. But later I received confirmation emails - a dozen of them. What I never got was a straight refusal to provide a speaker. Instead, weeks went by with no response and I looked elsewhere.
Automated systems are always fraught with danger. But those which are set up to manage standard processes should be monitored to reveal such problems, whether you are trading shares or looking for a presenter. And they should never be an end in themselves which have no consequences. I ended up suspecting that using Facebook’s online speaker request system was a deliberately designed cul-de-sac which nobody at the organisation ever looks at.
This year, wanting again to find a speaker, I spoke to a human at the social network’s PR company. Ironically, the result was the same - in response to a very detailed request, nothing came back. Even a simply no would be better than silence. UBS may well be thinking they should talk to a human broker next time they want to hand over hard cash for shares, especially when Facebook has lost one-third of its value since floating.
In my own case, I went and asked Google+ to speak instead - and they are headlining the DataIQ NOW! conference next week (http://www.dqmgroup.com/now2012/programme). Swiss bankers will undoubtedly now look for other, more responsive recipients for their money, too.