Mark Zuckerberg urged by investors to drop ambitions for Metavers

After a 2022 year in which Meta’s share price has plummeted 60% and CEO Mark Zuckerberg has “buried” more than $15 billion in developing a Metavers that no one else seems interested in, Meta shareholders are showing signs of running out of patience, publicly demanding a return to reality.

At $320 million, Meta represents the third-largest investment in Altimeter Capital’s portfolio, with chief Brad Gerstner seeing his fortune eroded bit by bit as Zuckerberg continues to pour seemingly unlimited funds into the development of his Metaverse project. Relative to the total value of the Meta giant, Gerstner owns just 0.1% of the company’s shares, so he can only publicly put pressure on Mark Zuckerberg to do something else, such as revamp Facebook’s network, the company’s main source of revenue.

Gerstner’s letter includes a list of suggested remedies for Meta’s so-called lack of focus, including reducing the company’s headcount by at least 20%, cutting annual capital expenditures by at least $5 billion, and limiting investment in Reality Labs (the research division responsible for Metavers) to no more than $5 billion per year – a massive reduction when compared to the company’s spending this year.

Among the arguments Brad Gerstner makes is that “Meta has lost the confidence of investors” who simply no longer want to back the Metaverse project.

Gerstner’s letter is just the latest voice in a growing chorus of disgruntled investors expressing doubts about the viability of Meta’s plan to transition its user base into the VR world by developing both the software infrastructure and the necessary hardware with its own resources. In the meantime, Facebook has become one of the most stagnant social networks, with uninspired changes to content algorithms sparking anger among the remaining users, while younger audiences seem to have already migrated to more welcoming alternatives like TikTok.