Instagram buy spooks Facebook shareholders -

Social networking site Facebook might not really be ready to go public because Mark Zuckerberg is not that keen on keeping people in the loop.

When Facebook decided to buy Instagram, a photo-sharing service for billion dollars, the board was the last to know.

By the time Zuckerberg thought about telling the board, the deal was all but done.

That was Facebook's largest acquisition ever, and Zuckerberg and Instagram CEO Kevin Systrom had already been talking over the deal for three days.

Zuckerberg did the negotiation on his own and had beaten Systrom down from $2 billion.

The negotiations were held at Zuckerberg's $7 million five-bedroom home in Palo Alto. 

While this sort of thing is the stuff of business legend, it is not the sort of antics that Wall Street expects for a company that wants to be a blue-chip ahead of its initial public offering of stock in a few weeks.

Real companies use ranks of lawyers and bankers to scrutinise deals before proceeding and that can take weeks.

According to the Wall Street Journal, by the time Facebook's board was brought in, the deal was all but done. The board, according to one person familiar with the matter, "was told, not consulted."

The board has little power, Zuckerberg owns 28 percent of Facebook's stock, and controls 57 percent of its voting rights.

This deal should have had the board screaming. Although it has been growing fast and owns a product that Facebook is weak on, Instagram is 18 months old and has no real revenue.