Facebook's IPO Has Given Henry Blodget the Chance to Say Sorry
Henry Blodget, the Business Insider mogul, is the perfect man to cover Facebook's IPO drama. In fact, there may never be another story better suited for Blodget to cover. Not only does the twisty, controversial tale of the social network's IPO speak directly to Blodget's area of expertise, but in covering it day in and day out, Blodget may finally find redemption for his past.
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Throughout this whole Facebook mess, Blodget has acted as a constant and informative source of information, which one can learn all about in this piece by Slate's Farhad Manjoo, where he praises Blodget's site's aggregation mixed with inside finance knowledge. "I feel the need to praise Blodget because no one else seems to be doing so," Manjoo writes, after describing Blodget's coverage over at Business Insider this last week. But then, immediately after he says. "I understand the reluctance." That reluctance comes from that icky feeling we get when we see an all caps headline for some non-news tidbit, or the "over-aggregation" some have accused the site of practicing. And then there's Blodget's past. He's ostensibly accusing the finance guys of something for which he was once accused. It's a like a reformed bad guy becoming a vigilante. But, while Manjoo praises Blodget's effort, he does not consider that his motivation extends beyond informing the public about Facebook's evil.
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Blodget has been all over Facebook's IPO from the start. After months of covering the company's SEC filings and roadshow on Business Insider, he wrote a pre-IPO New York magazine cover story that portrayed a grown-up Mark Zucekerberg and a mature company. What better endorsement could the company have than a former analyst offering a favorable take on its IPO prospects? Once that IPO got scandalous, Blodget continued to voraciously and thoroughly cover the story on Business Insider.
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Blodget has gotten so involved that his name has been invoked in Morgan Stanley meetings, he said in a post today. "The word I got yesterday was that Morgan Stanley was blaming the Facebook scandal on me because I have recently written articles about how outrageous it was that institutions were told about Facebook's lousy quarter and individuals weren't," he writes. Blodget reminds us (as if anyone reading Business Insider can forget) that he once was in Morgan Stanley's position, calling himself a "famous Wall Street analyst." This of course informs his writing, or deepens it in Manjoo's words, giving him the exact right experience, context and knowledge for his coverage. How much experience? In 2003 the Securities and Exchange Commission charged Blodget, then a Merrill Lynch analyst who'd written about the first dot-com stocks going public, with fraud for having given conflicting information to insiders and investors. (Sound familiar?) That experience didn't come cheap: Blodget had to pay $4 million in fines to the SEC. (Ever the humble-braggart, Blodget writes about his own fine this way: Blodget's SEC Fine To Reduce National Debt By $4.2 Million.)
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With that in mind, this seems to be the perfect moment for Blodget to atone for his sin's of yesteryear. He can now show the world his improved self, while outing his former colleagues for their continued fraudulent behavior. This is the club that kicked him out. What better way to get back at them?
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So, Blodget has risen to the occasion, using his opportunity, at least mostly for good. For example, we get this from today's post:
When the Facebook IPO disclosure scandal was revealed a few days ago, Morgan Stanley immediately protested that it had followed all the rules.
And that may, in fact, be true.
The problem is that, as Facebook has illustrated, the rules themselves are grossly unfair.
Because of his time at Merrill and his very public atonement, Blodget knows how Morgan Stanley screwed investors over with Facebook. With that in mind, Blodget's Facebook coverage can be read as a pseudo apology.
We say pseudo, because there's another motivating factor: He wants to prove he is better than them. In the Business Insider way, he is milking it. He has written thousands and thousands of words, having no problem including a few posts about himself. They even employ BI's singature hyperbole—EXCLUSIVE!; BOMBSHELL! -- making everything sound a tad more urgent than reality. Blodget is shouting. He wants us to know he's really sorry. And he wants to show that he wasn't the only bad guy on Wall Street. It's a twofer.
But, no matter his motivation, for someone trying to stay updated and understand an otherwise technical topic, Blodget's over-the-top approach is worth it. He's been there, okay? He gets it. And thanks to him, now so do we.
