March 4 (Bloomberg) -- Facebook Inc., the second most- popular social-networking Web site, hired Google Inc. veteran Sheryl Sandberg as operating chief, mining its rival's ranks to gain expertise in online advertising sales.

Sandberg, 38, will start March 24, Palo Alto, California- based Facebook said today in a statement. She joined Google, the most popular search engine, in 2001 and served as vice president for global online sales of the company's ad products.

Facebook is bolstering its management to cope with a fourfold surge in users in January from a year earlier, and rising demand from advertisers. The company is battling Google and social-networking rival MySpace for sales in a market that may almost triple to $2.5 billion in the U.S. by 2011, according to research firm EMarketer Inc. in New York.

``Hiring someone who has a great deal of experience, who has made a model very successful, will be to their benefit,'' Jennifer Simpson, an analyst at research firm Yankee Group in Boston, said in an interview. ``Advertising is going to be an absolutely essential part'' of expanding the company beyond simply adding more users.

Facebook said Sandberg will help build its operation globally, managing sales, marketing and business development. She will report to Mark Zuckerberg, the company's 23-year-old chief executive officer.

David Fischer, vice president of online sales and operations at Google, will take over Sandberg's duties, spokesman Matt Furman said in an e-mail.

Google, based in Mountain View, California, dropped $12.42 to $444.60 at 4 p.m. New York time in Nasdaq Stock Market trading. The stock has fallen 36 percent in 2008, to the lowest in almost a year.

Beacon `Bomb'

Sandberg joins three months after Zuckerberg apologized to Facebook users, who complained that an ad program called Beacon violated their privacy. Beacon tracked what users bought and shared that information with their friends. Activist group MoveOn.org said the technology shared data without users' consent.

``Beacon was a bit of a bomb for Facebook,'' Simpson said. ``They have been trying to recover'' relationships with advertisers ever since.

Sandberg, who has an MBA from Harvard Business School, oversaw Google's business of selling ads directly to customers over the Web, complementing Google's sales force. She also helped co-founders Larry Page and Sergey Brin start Google.org, the company's philanthropic arm.

McKinsey Consultant

Prior to joining Google, Sandberg was chief of staff at the U.S. Treasury under President Bill Clinton. Before that, she was a consultant with McKinsey & Co.

Visitors to Facebook more than quadrupled to 100.7 million in January from a year earlier, according to researcher ComScore Inc. in Reston, Virginia. The site gained on MySpace, owned by Rupert Murdoch's News Corp., which had 109.3 million users, an increase of 15 percent, ComScore said.

In July, Facebook hired Gideon Yu, the former chief financial officer of YouTube, the video-sharing site Google acquired for $1.65 billion in 2006.

The departures from Google highlight the mounting competition for talent in Silicon Valley, and the difficulties Google faces in hanging on to key people, Simpson said.

``Sheryl was a valued member of the Google team,'' Senior Vice President Omid Kordestani said in an e-mailed statement. ``We have a deep management bench.''

Microsoft Corp., the world's largest software maker, purchased a 1.6 percent stake in Facebook for $240 million in October, valuing the company at $15 billion. Microsoft, which also has an agreement to sell banner ads on Facebook, beat out a bid from Google. Google and MySpace have a similar deal.

To contact the reporter on this story: Ari Levy in San Francisco at alevy5@bloomberg.net

Last Updated: March 4, 2008 18:25 EST