As I was reading Meta’s impressive and out-of-this world earning numbers, few things came to mind:
Why didn’t I invest in Meta’s shares two years ago when it was still called Facebook, with prices ranging from $90 to $210? I did consider it then, but hesitation and various factors held me back. It’s a significant regret, especially considering the current price at $475, reflecting a remarkable +400% increase since the low in November 2022. The recent 20% surge post-earnings report and the introduction of a 50-cent quarterly dividend have also brought newfound passive income for investors, highlighting Meta’s impressive earnings and substantial growth.
The second thought that came to mind, given that I write about budgeting and personal finance, is the question of how or can this be related to personal finance in general? If a behemoth like Facebook/Meta can rebound and steer a giant ship like this, I am sure as individuals we can also turn our finances and life around as well? And that is when I decided this was a topic well worth exploring and writing about: drawing parallels between Meta’s turnaround and personal finance by emphasizing the importance of strategic planning and adaptability.
According to a recent survey, 78% of Canadians live paycheck to paycheck, and only 26% have an emergency fund that can cover at least three months of expenses. If you’re one of them, you might be wondering how to get out of this cycle and achieve financial freedom. Well, you’re not alone. Even one of the biggest and most successful companies in the world, Meta, faced a similar situation a few years ago. But they managed to turn things around and become more profitable and innovative than ever. How did they do it? And what can you learn from their story? In this article, we’ll explore some of the key strategies that Meta used to transform their business and their brand, and how you can apply them to your personal finance and budgeting.
The great Meta pivot towards efficiency
Back in early 2022, while the world was still grappling and trying to exit out of a generational pandemic, Facebook was focusing on the Metaverse, a vibrant, accessible, and interconnected realm, reminiscent of the internet but existing in a three-dimensional space. In fact, Facebook CEO was so focused on this endeavor, that he ended up renaming the company from the familiar Facebook to the less known Meta. Not only that, the company was burning billions in cash every month, trying to develop this 3D world. But after bleeding so much money in the process, investors had had enough, and that forced the Zuck to pivot and respond, and what a pivot it was! Starting the new year, Meta’s CEO decided that 2023 would be the “Year of Efficiency” . Let us pause for a second and take that to a micro level and how it applies to us as individuals? when our finances reach a critical point, do see the signs and make adjustments accordingly? or do we let it slide until it is late? One of the things that Meta did to turn things around was to lay off thousands of their employees and cut costs drastically. While no happy news for these employees and their families, these billions in cuts made Meta more efficient and lean, allowing it to be ready for the next wave that would hit late 2022 and that would dominate 2023: AI.
What can we learn from Facebook and Meta’s rebound and turnaround?
In his address to shareholders and investors, Meta CEO Mark Zuckerberg made it clear and hinted that his company not only has what it takes to succeed in the new world of AI but may have the edge to be the dominant winner in the AI arms race. In other words, just two years removed from the Metaverse fiasco and all the billions that were being burnt monthly on that project, the company has turned things around so much that they are ready and confident in taking on the next big thing in computing – AI. There is a lot to take from this and apply to our personal finances and how we lead our lives in general. First comes the admission that something is not right and that we need to change. Without this, no pivot, turnaround, or progress can ever be made.
Next comes the hard work and sacrifices to enact significant changes and bold moves. In Meta’s case, approximately 20,000 jobs were eliminated, resulting in billions of dollars lost to restructuring costs associated with these layoffs. Then, after enduring challenging months and receiving bad news, the sun rose over Meta once again. If we are navigating tough financial times, tough choices and hard work are necessary. This involves creating a budget if we don’t have one, prioritizing savings, investing wisely, and adapting to the ever-changing world by investing in ourselves. In the case of Facebook, they realized that while the Metaverse may still be a big thing one day, they quickly shifted their focus to AI and that has put them at a great advantage as one of the main leaders in this field. As individuals, we should take an honest look at ourselves and see what career and knowledge changes can we make to keep up with the latest trends and changing world. We can’t be content with what we have just because we have a stable paycheck coming in. Nor can we be too scared to do anything with our money than to simply stash it in a saving account forever.
In this article, we’ve explored budgeting strategies inspired by Meta for personal finance. Meta’s efficiency initiatives offer valuable insights for personal finance. Aligning financial decisions with long-term goals, individuals can prioritize essential expenses and eliminate non-essential spending, fostering a leaner and more efficient financial lifestyle. Like Meta’s investment in tools and technology, individuals can invest in their personal growth and education to enhance their earning potential. Making sacrifices, whether in restructuring or personal finance, is crucial for achieving high-impact goals. Adapting to economic realities involves assessing and adjusting financial strategies, while bold decision-making and a resilient financial community can contribute to long-term financial security. In essence, adopting Meta’s principles involves aligning goals, optimizing spending, investing in personal growth, making sacrifices for financial goals, adapting to economic changes, and fostering a bold and resilient financial mindset.