It’s been a year of milestones for Mark Zuckerberg, Facebook’s youthful founder and CEO.

The social network passed half a billion users and, by some estimates, passed Google as the most-visited website in the U.S. It grew to 2,000 employees and reportedly more than doubled its ad revenue to as much as $2 billion.

But it was a year of milestones as well: Facebook faced criticism from users and lawmakers over its handling of privacy, a controversy inflamed by Zuckerberg’s sometimes awkward statements on the subject. And a movie based on a thinly fictionalized, and not entirely flattering, portrayal of him became a box-office smash.

It would have been an easy year to get distracted. Zuckerberg didn’t, guiding Palo Alto, California-based Facebook through the highs and the lows with remarkable focus. He made Facebook even more central to the Internet’s future by overseeing a stream of product releases.

In doing so, Zuckerberg completed a critical transition, one that has eluded many other rising stars, from startup visionary to large-company CEO.

For these reasons, the San Francisco Business Times has named Zuckerberg as its CEO of the Year.

Peter Thiel, a co-founder of PayPal and now a Facebook director, said Zuckerberg “combines the best of Steve Jobs and Bill Gates.”

“He was the right person to start Facebook, and he is the right person to be running the company,” said Thiel, who was one of its earliest outside investors in 2004: “He’s a product visionary.”

Others see Zuckerberg’s ability to adapt as one of his greatest strengths.

“Mark still has a lot to prove, but it’s hard to begrudge Mark the success he’s created or the way he’s changed the world since founding Facebook in a dorm six years ago,” said Augie Ray, a senior Forrester Research analyst of social networking and interactive marketing.

Along with changing the world, Zuckerberg has changed the company—and himself—when circumstances require.

Early in the year, Zuckerberg faced fire from all directions after Facebook introduced a new program called “instant personalization,” which gives selected companies access to people’s public Facebook data.

The social network had already ignited flames in December 2009 when it made some user data public by default. In January 2010, Zuckerberg suggested that expectations of privacy were no longer a “social norm,” adding fuel to the fire.

The nadir may have been in June when Zuckerberg looked tense and sweaty while questioned onstage about privacy issues at the Wall Street Journal’s AllThingsD’s annual conference in Southern California.

Facebook watchers began questioning whether Zuckerberg had gotten out of his depth, if at 26 he was equipped to lead a company as large as Facebook was becoming. Zuckerberg successfully shifted gears, getting praise for defusing a storm of criticism.

Offering a mea culpa if not a full apology, he made changes including creation of stronger user privacy controls, although company spokesman Larry Yu insists that the company only “simplified” its privacy tools.

Zuckerberg then went on the offensive, insisting that Facebook never gives private user data to other companies.

“Every time there is some adversity, Mark stays focused and powers through it,” said prolific early-stage technology investor Ron Conway, who helped Facebook in its early years and obtained a “not trivial” chunk of stock options.

Facebook continued to introduce features that included the check-in service called “Places” in August and the associated “Deals” offering in November, geo-location services that could bolster advertising revenue.

A messaging application introduced in November could challenge email as a communications platform, and a profile page redesign in December was released without major controversy, with users given the option of keeping their old profile layouts.

“The rate at which Facebook is releasing new products is continuing to be very quick,” said Justin Smith, founder of Inside Network, which publishes news and market research. “Ultimately, what Facebook achieved over the year was impressive in the scale of growth and the breadth of the global issues the company has been facing.”

Trip Hawkins, CEO of San Mateo, California, gaming company Digital Chocolate, said he met Zuckerberg at a barbecue for developers in September and came away impressed.

“I like him. He’s remarkable,” said Hawkins, who previously founded gaming giant Electronic Arts. “For a big and very hot company, they are remarkably friendly and collaborative with third parties. They’re a feel-good company and not merely preoccupied with crushing their opposition in this dog-eat-dog world.”

Investors, needless to say, have been thrilled as Facebook’s valuation has skyrocketed as high as $56 billion, according to trading of the private company’s shares on secondary markets.

Zuckerberg rejected past offers to buy Facebook, including one for $15 billion from Microsoft, not just because he believed the company could be worth more, Thiel said.

“He’s not in it for the money,” investor Thiel said. “He was interested in building the product, and he did not think he’d be able to build the product in the context of a bigger company.”

This is an excerpt from a profile of Facebook CEO Mark Zuckerberg appearing in the San Francisco Business Times. For more on Bezos and Amazon, go to the Business Times.

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Patrick Hoge writes for the San Francisco Business Times.