Back in the pre-bubble days of Web 1.0, we wrote a piece called, “How to Get Rich in Silicon Alley – The First Wave.” We still have it, for those of you who’d like to see it; it’s too long to include here – and part of it was a ‘guide’ to how to keep employees chained to their desks by incentivizing them with anything but money, which, of course, as founders, you wanted to keep for yourselves.
That was then and this is now and not much has changed in all quarters of technology, except for company names and maybe a slightly different lexicon. ‘Millenials’ is a new one and we’re actually not attacking you all here, so calm down. This is meant to be instructional. Millennials are being dot.conned by cult-like tech companies, said this New York Post piece about “Fake Steve Jobs” Dan Lyons, a former HubSpot writer who now writes for “Silicon Valley,” as in the HBO show, and his experiences in the tech world – specifically, at HubSpot. “A huge chunk of potential compensation at tech startups comes in the form of stock options, which could turn out to be worth nothing but are certainly worth nothing if employees get so burned out that they leave before the options vest,” reads the piece. “This is part of the plan. Tech firms basically operate like South African gold-mining operations, with confident young Tame Impala fans being the bodies thrown into the pit to break their backs digging up nuggets. All of the IPO gold, though, goes straight into the pockets of their masters topside.”
You know how it goes: unless you’re the lead dog, the scenery never changes.
“At HubSpot, every time another bedraggled would-be “world changer” hauled his dejected remains out the door, or got fired, the company would say he or she “graduated.” “Team, just letting you know that Derek has graduated from HubSpot, and we’re excited to see how he uses his superpowers in his next big adventure!” a typical e-mail would read.””
We know the drill in the startup world (and when, exactly, does a company stop being a startup?): long hours, little pay – but you can wear shorts and flip flops and there are almost always candy machines or Pizza Fridays. At HubSpot, they even have an unlimited vacation policy. Brilliant! According to the Post piece, “Fired employees have no accrued vacation time, which saves the company payouts to its “graduates.” Firms with vacation plans are also required to set aside cash reserves to cover the cost. HubSpot dodged this cost.”
And you wonder why companies prefer to hire younger, less experienced workers… And why we refer to many of the better-known/media darling founders as the tech overlords, and they’re not all necessarily unicorns, although, as the article points out, HubSpot is one, as a result of its IPO, despite the fact that it has yet to make a dime in profits. Voodoo economics is not a new term, but it’s certainly applicable in the tech world.
We know that Millenials are driven by doing good for the world and somehow, giving back, or working for a company that’s doing so-called social good. All well and good, but charity begins at home and you to take care of your own first – which includes paying your people a living wage (Man moves to San Francisco, pays $400 a month to sleep in wooden box in friends’ living room).
We know from experience that many a Millenial will start a company and live/work from home, as do many of their cofounders and early employees, while they gather eyeballs, then go for funding. We know that, as a generation, you’ve never experienced this before, but Forget unicorns – investors are looking for cockroach tech startups, meaning “… a business that builds slowly and steadily from the get-go, keeping a close eye on revenues and profits. Spending is kept in check so that it can weather any funding storm.”
Think P/L rather than insanely overvalued PE ratios.
The unicorn body count is growing – and leaving massive numbers of unemployed tech workers in their wake. Losing a job is a rite of passage, but it doesn’t mean that you go to the head of the class – unless you’ve learned something. Like the fact that it’s time to stop drinking the Kool Aid, and to stop making the same mistakes and putting someone else’s ‘vision’ above your basic survival needs, meaning, nothing says more that you’re a valued employee than a decent salary. Above all else remember that at the end of the day, you’re working for yourself. Truth be told, unicorns were real and they were ugly and if you’ve fallen for the same old, same old often enough, you might want to look at it this way: it wasn’t that you were drinking the Kool Aid: it’s more like you were delivered a sucker punch. Time to move onward and forward.