Business Insider Offers 'Real Story' About Purported Goldman-Facebook Conflict

Following on The New York Timesstory about tensions between Facebook and Goldman Sachs arising over the Wall Street firm’s decision to deny U.S. investors a chance to buy Facebook shares, Business Insider comes back with an additional bit of reporting that it says contradicts The Times’ account.

Whereas The Times’ Andrew Ross Sorkin characterizes relations between the two companies as “frayed,” some “People familiar with Goldman’s and Facebook’s view of the situation” beg to differ, according to Business Insider editor Henry Blodget:

Rather, say these people, both Facebook and Goldman are unhappy and frustrated at the outcome of the US deal, but do not necessarily blame each other for what happened.

Here are some other nuggets of information from people familiar with the companies’ views:

Goldman and Facebook obviously expected that the Facebook transaction would generate significant publicity. What they did not anticipate, says a person familiar with Goldman’s view of the situation, was the amount of the publicity and the amount of inaccurate information that would be reported. They also did not expect news of the transaction to leak as early as it did.

The media coverage of the Facebook deal eventually included details that were either taken out of context or were inaccurate, says the person familiar with Goldman’s view of situation–including some financial details and the frequent assertion that the deal had closed or was about to close when in fact it had not.


In any event, the people familiar with Goldman’s and Facebook’s view of the situation do not feel that the Goldman-Facebook relationship is “frayed.” They just regard both sides as “frustrated.”

We wonder what kind of sources are familiar with the two companies’ view of the situation and have every incentive to put a story out there that portrays the Goldman-Facebook relationship as just peachy. We also wondered what a spokesman for Goldman or Facebook might say about Business Insider’s unnamed sources, and so we’ve put out inquiries to both companies and will update when we hear back. (A Goldman spokesperson declined to comment for The Times‘ story.)

Update: A Facebook representative declined to comment on this story.

mtaylor [at] | @mbrookstaylor