Facebook's COO is tearing down the temple. That's the only conclusion I can reach after witnessing the Sheryl Sandberg's management of the Palo Alto-based social network. What I hear from inside Facebook: She demands total loyalty, and brooks no dissent — even the healthy, boisterous debate that's common to startups. You're either with Sheryl, or you're against Sheryl. And if you're against Sheryl, you're not long for Facebook. What's really frightening is how she effortlessly cajoles lies from her underlings. Note how Matt Cohler and Ben Ling exited the company singing her praises — despite what the talented executives were telling confidants in private about Sandberg. There's a simple explanation for that: She bought them off, with still-valuable Facebook stock.Do the math: Ling joined Facebook in October 2007. He's leaving Facebook in a few weeks, months before his one-year anniversary — and it normally takes one year of employment for stock options or restricted stock to vest. However miserable Ling was under Elliot Schrage — Sandberg's personal flack and de facto chief of staff, whom she put in charge of Facebook's development platform, to the utter shock of the entire Valley — can you imagine he walked away from that much money? Far more likely: Sandberg and Schrage asked him to resign in exchange for getting to keep his shares. Ling, who was well-regarded at both Google and Facebook, now gets to walk away from Sandberg's mess. Cohler, formerly Facebook's product chief, has also made nice noises about Sandberg — and he, too, needed the cash. He's now a general partner at Benchmark Capital, where Sandberg's husband, Dave Goldberg, is employed as an entrepreneur-in-residence. (None of this is coincidence.) General partners at VC firms normally buy into the funds they invest; Benchmark Capital's most recent fund, raised in February, is an eye-popping $500 million.The amount Cohler would have to invest personally comes to roughly $500,000, by my estimates. Selling his Facebook shares seems like the most likely way he'll come up with that money. Isn't it likely that in exchange for making nice noises about Sandberg on the way out, Cohler got an assurance that Facebook won't make trouble about his share sales? The fundamental problem with Sandberg's take-no-prisoners management style: It's exquisitely tuned for the zero-sum world of Washington, where you're either in power or out. She's treating her appointment as Facebook's COO like a new administration coming into the White House. Her years at Google, which was the only tech-startup game in town for the long years of the bust, reinforced the wrong lesson. Washington's bitter internal rivalries thrive on a scarcity of opportunity. Today's Valley has an abundance. Her employees have options, and not just the kind she can grant. Which leaves the question: Why is Sandberg so determined to drive talent out of Facebook? My working theory: She wants to remake the company in her image. Here comes the Sandberg Administration! But to do so, she'll need to find skilled accomplices, not servile yes-men like Schrage (who wouldn't know an API if it extended his subclasses). And she'll need to articulate what, exactly, her new vision is. For all of Mark Zuckerberg's flaws, he's created a website which will soon have 100 million users, and is worth billions of dollars according to a long line of Silicon Valley moneymen who are slavering to buy his employees' shares. What, exactly, has Sheryl Sandberg done, besides buy a lottery ticket by joining Google when it was still private? Sometimes you have to tear down before you build. But no one knows what, if anything, Sandberg is building — besides fear and doubt. That's hardly the mark of a Silicon Valley leader. It's a tactic that may have worked in Washington, D.C., where Sandberg worked for the viciously political Clinton administration. But she's killing the company's morale with her Beltway tactics. If she has a bright idea, she'd better start talking about it. It will take far more than three days to rebuild this temple — and it's not clear she has time to spare.

In a post hypothesizing who will be next to leave Facebook, commenter MrMedia, wonders out loud about the job climate at the high-flying social network:

Most teenage girls on Facebook and MySpace would ignore messages from a guy calling himself "jadedwasted." That's the nom de Web of Warren Nanney, a guy whom Idaho cops are investigating for allegedly approaching young women for sex on social networks. On Facebook alone, Nanney had "over 500 contacts, 500 people listed as friends and 90 percent of them were under the age of 18," according to local police. Nanney was also allegedly cruising MyYearbook.com, a site the investigators say they'd never heard of before. (It's one of Barry Diller's favorites.)A+ to Facebook for brand recognition? But it wasn't the profiles or messages that took down Nanney — it was after one 17-year-old woman who did meet with Nanney called the cops, fearing for her safety. As much as law enforcement relies on the open surveillance they can engage in online, it's still the girls themselves who best know when to sic the cops on a creep.

Click to viewCameron and Tyler Winklevoss, the twin cofounders of a college social network which is not Facebook, finished second in today's Olympic rowing semifinals, just behind the Aussies, and will compete in the finals on Saturday. It was quite the upset. Previewing today's race, Row2k.com wrote that "the Aussie pair is a lock," that "Serbia, Germany, Italy are the like contenders for the final two qualifying spots," and that the ConnectU cofounders "have their work cut out for them if they want to win a spot in the A final." While they were winning in Beijing, they lost a battle in court.The pair alleged that Harvard classmate Mark Zuckerberg stole their idea in creating Facebook, ended up settling, and then appealed over the terms of the settlement; a judge denied their request. But if their long-fought legal battle with Facebook proved anything, it's that the JFK Jr.-lite Winklevoss brothers never quit, even when everyone — including judges — thinks they should. Take that, Serbia! (Photo by Getty Images)

Mark Penn, the CEO of Burson-Marsteller, will likely never work in politics again. He's in hot water over his advice to Hillary Clinton. A series of memos obtained by The Atlantic show Penn offering Clinton unsavory advice. (For example: highlighting Barack Obama's childhood abroad as a way of suggesting he was too foreign to be president.) But the fallen flack has a promising career as consigliere to tech CEOs, based on his advice to Bill Gates: "Being human is overrated."

The departure of star Facebook director Ben Ling has been roiling Facebook since word first spread at the social network's Palo Alto headquarters yesterday. One inevitable question some Facebookers are asking: What does this mean for the price of our stock? If Facebook were publicly traded, it's unlikely one employee's exit would cause a blip. But private tech companies like Facebooks are the ultimate growth plays, and momentum matters. If Facebook becomes known as a place top talent flees instead of gathers, it could tank Facebook's perceived value. What will be telling: Who leaves next, and how fast. One likely candidate: Chamath Palihapitiya.Palihapitiya, like Ling, has not fared well under the reign of COO Sheryl Sandberg and her right-hand man, Elliot Schrage. Schrage, as a reward for the puff pieces Sandberg's continued to garner from a mostly pliant press corps, has gotten handed most of Facebook's marketing functions. Palihapitiya has been left with a vague "growth" portfolio. How frustrating this must be for Palihapitiya, who once complained on film about white-male privilege. His employer at the time, the Mayfield Fund, hastened to clarify that his comments were about the world at large, not meritocratic Silicon Valley. But Elliot Schrage, with his two Harvard degrees, is a creature of New York and Washington, D.C., not the Valley. And he has blocked Palihapitiya's rise at Facebook, despite the latter's vastly more impressive tech résumé. Will Palihapitya rest and vest his Facebook shares in silence? Or will he leave, like Ling?

Because an evening out didn't actually take place unless there's plenty of photographic evidence to prove it, some enterprising soul has invented a retro, communal photobooth with customizable backdrops, which we're guessing will be at parties everywhere soon enough. [CoolHunting]

Ben Ling, Facebook's high-profile director of platform product marketing, considered a star poach from Google, is now rumored to be moving on from Facebook. Kara Swisher has further details. We think we know the story: Facebook COO Sheryl Sandberg, in a widely derided move, put a nontechnical guy, her aide-de-camp and chief flack Elliot Schrage, in charge of Facebook's applications platform. Photo above: Ben shaking it at Club Asia in 2006, in a now-unpublished YouTube video.

Metrics firm ComScore reports that 132 million unique visitors logged onto Facebook in June 2008, up from just 52 million in June 2007. 117 million worldwide users visited MySpace during June 2008. Its Facebook's first definitive traffic victory, from a source advertisers actually pay attention to, over MySpace. Way down on the list at No. 6 — past the fast-growing Hi5, past still-kicking Friendster — there's AOL CEO Randy Falco's $850 million social network, Bebo, which saw 24 million visitors in June.

ConnectU cofounders and Olympic rowers Cameron and Tyler Winklevoss beat out Croatia to win their second heat yesterday, advancing to Wednesday's semifinals. Meanwhile, back on the home front, U.S. District Judge James Ware said Monday that ConnectU has until Tuesday to transfer all its stock to Facebook and comply with a settlement to the ConnectU founders' suit alleging that Facebook founder Mark Zuckerberg stole their idea.The news is hardly bad news for the Winklevoss brothers and ConnectU's third cofounder, Divya Narendra. Court papers say the three will get "millions" of dollars in cash as well as stock in a startup too popular with mainstream America's millennial generation to fail. (The Winklevosses were fighting the settlement after they discovered that the Facebook common stock they would receive was worth less than they supposed.) Plus, there's still that shot at gold.

Cameron and Tyler Winklevoss — the founding twins of social network ConnectU who are Facebook's legal foes and also Olympic rowers — fared poorly in their first Olympic outing Saturday, finishing fifth out of five in a 2000 meter preliminary heat. The Winklevoss brothers — who delighted fans on the home front when they practiced shirtless late last week — finished in 7:13.64, well behind the Polish team which finished up in 7:01.90. Also waiting on the other side of the finish line were the French, Italian and Canadian teams, one of which presumably won, but who cares, our boys did not. The Winklevoss brothers were supposed to get a second chance on Sunday, but that second heat rained out and will be rescheduled. Nevermind that, we think its time for the Winklevosses to go to Plan B: sue the French, Italian, Canadian and Polish teams for stealing their idea of finishing faster. Update: The brothers won their second heat and advanced to Wednesday's semifinals.

Sarah Lacy, the BusinessWeek.com columnist whose pearl necklaces and resistance to insults I've always admired, explains to U.S. News & World Report how to use Facebook to "fire up your career." Yet she graciously avoids bragging about how she used Facebook to catapult herself to stardom. Lacy's personal assistant is just getting started on the job, so we thought we'd help out:

ConnectU founders and Olympic rowers Cameron and Tyler Winklevoss — the guys who are still in a legal wrestling match with Facebook CEO Mark Zuckerberg after suing him for stealing their idea, settling, and then rethinking the settlement — took their shirts off for rowing practice in Beijing. We thought some of you might want to know.

Facebook is under an attack of the worms similar to the MyDoom worm, rendered into an image above, that became the fastest spreading email worm ever in 2004. In recent days, thousands of users have fallen prey to at least two strains of malicious code that once downloaded onto a users computer, steal that user's Facebook username and password in order to spread itself via false links posted to friends' messages boards. Facebook security chief Max Kelly writes on the company blog that after a night of work, his team "identified and blocked the ability to link to the malicious websites from anywhere on Facebook." Security firm Sophos, which of course makes a living scaring people, says the threat isn't over. "If workers are allowed to be given access to these sites," goes Sophos "analyst" Graham Cluley's pitch,"then it's vital that they do not put their personal and corporate data at risk, and are protected from web-based infections."

In late 2006, Facebook was rumored to be looking to acquire StudiVZ — the German social network that's 10 times the size of Facebook's German edition. In the middle of the sales talks, StudiVZ sold to Holtzbrinck Group, a Germany publishing giant, for up to $134 million. Holtzbrinck then offered the site back to Facebook for a hefty markup. Facebook balked filed suit instead, claiming that StudiVZ's site was a nearly indistinguishable doppelgänger. [PaidContent]

At a recent party to celebrate developer Joe Hewitt's latest release of the Facebook application for the iPhone, friends treated Hewitt to champagne and a cake decorated with, naturally, an iPhone running Facebook. Of course, moments later, pictures of said cake showed up in partygoers' news feeds and were automagically displayed on their iPhones. And you doubted the power of technology to change the world for the better.

Bruce Ivins, the scientist who killed himself after the government linked him to the 2001 anthrax attacks, reportedly loved sorority girls. As all Americans do! He was supposedly obsessed with the Kappa Kappa Gamma sisters of Princeton. Now, as you can imagine, those girls are fielding a lot of media requests. They don't get it, though! As a sister writes to IvyGate: "i dont really get why he would be so interested in Kappa…i mean of all the sororities on campus we are the most diversely boring…and also the most unworthy of obsession." Regardless of whatever the hell "diversely boring" means (Ivy League education!), surely there's something interesting enough about these ladies to encourage a man to commit bioterrorism, right? We may never know, if these Facebook messages imploring everyone to keep silent are effective.

The prospect of Facebook minting new Valley millionaires is too delicious a story to check the facts. For example: Has Mark Zuckerberg, Facebook's CEO, actually sold shares? Sarah Lacy wrote that Zuckerberg sold $1 million in shares early in the company's history. BusinessWeek repeated the notion. Too bad it's not true, as Zuckerberg himself told the company in an email last Friday announcing a plan to let employees sell some of their Facebook shares.This much is true: Zuckerberg came close to selling his shares. But at the last minute, he backed out, and instead accepted a cash bonus of $900,000 from the company. Technically true that that wasn't a stock sale; but it did amount to a liquidity event for Zuckerberg — one that didn't quite make him a millionaire. Hence the seemingly arbitrary limit on employee's stock sales. In November, employees will be allowed to sell either 20 percent of their shares, or $900,000 worth of stock — whichever is less. (The $900,000 limit, seemingly arbitrary, was based directly on the size of Zuckerberg's cash bonus.) Those shares must be sold at the common-stock valuation of $4 billion, not the $15 billion valuation Microsoft paid for in preferred shares. (Preferred stock, because it allows owners to be paid first in the case of a sale, among other rights, is more valuable than common stock, which carries no such privileges.) Those are the rules, at any rate. Facebook will have a tough time enforcing them. There's nothing under the law preventing employees from selling more than $900,000 or more than 20 percent of their holdings, and there are plenty of willing buyers, some of whom may be glad to buy the shares at a valuation higher than the sanctioned $4 billion. (Facebook hopes to prevent sales at a higher valuation to avoid a revaluation of the company that could make it harder to recruit new employees.) What's likely to happen is that employees who break Facebook's rules will see promotions disappear and future stock grants dwindle — which will matter little to the company's earliest employees. How much money is at stake? A startup typically allocates 20 percent of its shares to employee options. Even at the lower $4 billion common-stock valuation, that's $800 million waiting to bust loose from Facebook's coffers. Will Facebook's earliest employees be satisfied with a six-digit payout, knowing that some wealthy investor would be glad to make them multimillionaires? (Photo by AP/Ruttle)

We present you Act I of Hamlet, the Facebook News Feed Edition, in its entirety. Click to embiggen. For the full story — including Polonius's riveting status update: "Polonius thinks this curtain looks like a good thing to hide behind," please see McSweeney's.

Days after a Facebook plan to let employees sell some of their shares leaked out, Valley stockbroker Laurence Albukerk told BusinessWeek that "he knows of at least nine people who have sold or are trying to sell Facebook shares," and estimates dozens more. But three of them were looking to dump shares at a $5 billion valuation — one-third the $15 billion suggested by Microsoft's investment last October. Two other firms bought shares at a discount $3.75 billion valuation, below the floor supposedly set by Facebook's program. Why the discrepancy? Partly because employees have common shares, not Microsoft's preferred shares. And partly because as eager as Microsoft was to buy into the hot social network last fall, Facebookers are now eager to sell. (Photo by Tim Parkinson)