Startup One Stop

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. Read More...

Of course, it’s really one point, when you get down to it. Between the high California taxes, outrageous rents ($250K Per Year Salary Could Qualify For Subsidized Housing Under New Palo Alto Proposal) and mushrooming number of H1B visa holders taking jobs formerly filled by American-born workers, meaning that American-born workers would have to take a considerable pay cut to compete with the auslanders, it’s all about quality of life. As a recruiter, we will honestly tell you that salaries for tech workers haven't significantly changed since the ‘90s, despite the fact that the cost of living has risen considerably in the venerated tech hubs - specifically, Silicon Valley and New York City - and rent/home ownership costs have skyrocketed.   And lest we forget, “…More than 80 percent of H-1B visa holders are approved to be hired at wages below those paid to American-born workers for comparable positions,” according to Mother Jones.

Former Intel chief and Silicon Valley icon Andy Grove died last week and a good time to remember Andy Grove’s Warning to Silicon Valley. ‘According to Mr. Grove,” says the article,  “Silicon Valley was squandering its competitive edge in innovation by failing to propel strong job growth in the United States…. Silicon Valley misjudged the severity of those losses, he wrote, because of a “misplaced faith in the power of start-ups to create U.S. jobs.” … But just as American companies have bolstered their profits by exporting jobs (or hiring H1Bs), many now do so by shifting profits overseas. “… All of us in business have a responsibility to maintain the industrial base on which we depend and the society whose adaptability — and stability — we may have taken for granted,” said Grove. Silicon Valley and much of corporate America have yet to live up to that principle.’

April is the cruelest month, wrote T.S. Eliot. It also marks the end of Q1 in a year abounding with unicorpses, so this may be a good time to take a look at the startup and investment landscape. Especially since, as CBInsights recently pointed out, many paper unicorns will be looking for more funding very soon (D-Day for Unicorns – When Will We Know if the Bubble Has Actually Popped?) and it’ll be interesting to see what happens, especially considering layoffs many of those companies are experiencing, and Snapchat’s recent flat round.

Hate to state the obvious, but isn’t the definition of a successful business one that makes money? And shows black on its balance sheet? Unless there's some special Silicon Valley Math that we don’t know about...

Not long ago, Stephen Hawking warned that because people would be unable to compete with an advanced AI, it “could spell the end of the human race.” Elon Musk has weighed in with his concerns, too, warning that AI could be more dangerous than nukes. Those who found themselves amused by Google’s robots that could pick themselves up, but were still not quite a match for the guy who knocked them down, or watched a Google robot dog play with a real dog, might have considered Hawking's and Musk's comments as needlessly promoting fear-mongering, as they were jumping the gun on some possible far-off dystopian future, the operative being ‘far-off,’ given the various foibles of the robots.Technology, including AI and robotics, were still in their early stages. We know that the two are completely different disciplines: patience.

In case you missed it, last week, Google’s AlphaGo beat a Go master, employing (in the third game, the AI having won the previous two) a move that was first perceived as a glitch in the program, as it came from out of nowhere and made no sense at all. It was a move that led to the program’s victory over the previously nearly-undefeated human, and no one saw it coming, of course, the latter part of the sentence being the operative. That so-called glitch has described as being both ‘inhuman’ and ‘beautiful,’ and while both are true, the net-net is that it’s potentially pretty frightening. It seems AI, which is ‘Artificial Intelligence,’ but given what amounted to be the alien nature of the program’s decision, maybe we do need to re-define AI as ‘Alien Intelligence,’ the program’s odd move having first been perceived as a move outside human comprehension, ergo, ‘alien.’

Ever notice that Facebook doesn’t have a ‘dislike’ button? You can ‘unlike’ something, once you’ve liked it, but you’re not allowed to ‘dislike’ a post. Dissing is evidently verboten. Bret Easton Ellis recently posted a piece on Living in the Cult of Likability and, let’s face it, your posts are defining your ‘brand,’ lest we forget that you are the product, after all. “Instead of embracing the true contradictory nature of human beings, with all of their biases and imperfections, we continue to transform ourselves into virtuous robots. This in turn has led to the awful idea — and booming business — of reputation management, where a firm is hired to help shape a more likable, relatable You. Reputation management is about gaming the system. It’s a form of deception, an attempt to erase subjectivity and evaluation through intuition, for a price,” says Ellis.

As 37 Angels founder Angela Lee pointed out when she spoke at a recent SOS Investor Breakfast, it takes 10 years to build a company. We know that that seems like a lifetime to many young founders for whom 10 years is nearly half of their lives to date, and it’s tough to be patient when you hear about companies becoming unicorns seemingly overnight (although let’s not forget that many have been downgraded and the unicorpse count seems to be growing (Total Number of Downrounds Since 2015: 56 – and CBInsights now has a Down Round Tracker. Sign of the times). It’s all well and good to want to move fast and break things (Facebook) or to ask forgiveness, not permission (general tech mantra), but here’s Why Zenefits and Other Tech Upstarts are Getting Their Comeuppance. In other words, playing fast and loose with regulations and regulators doesn’t always work.And speaking of Zenefits, once you’ve broken one rule, what’s a few more? No, having sex and drinking and smoking in the stairwells are still all pretty generally not a great corporate policy and not quite what people mean by that work/life balance thing. Certain behaviors that one generally conduct as part of one’s personal life are best conducted outside of the office – which includes stairwell, too.

Last week, Apple CEO Tim Cook defied a federal court order to implement a backdoor into the company’s software, which would allow government investigators to secretly listen in on encrypted data from users’ various communications platforms on the phone. This was in the name of national security, of course, in order to crack the iPhone of the San Bernardino shoooter Syed Farook for the purposes of information-gathering. Never mind that the government doesn’t do its job – defend the borders – so that suspected terrorists don’t enter this country in the first place – which in this case, at least one did. Did they look at the Facebook page of his wife/accomplice Tashfeen Malik – the red flags were there, and while we don’t sanction racial or religious profiling, we’re talking about vetting people who want to enter this country permanently, which has, historically, always been policy.By the way, Farook’s phone was government-issued and the password was reset by the  agency that employed him after it was in FBI custody. In fact, according to the AP, “The county government that owned the iPhone…paid for but never installed a feature that would have allowed the FBI to easily and immediately unlock the phone… The service costs $4 per month per phone." Your – and California’s – tax dollars at work.

The line comes from the poem, “Ozymandias,” fyi, and for some reason, we could bot get it out of our head.

Last week, Marc Andreessen tweeted, “Anti-colonialism has been economically catastrophic for the Indian people for decades. Why stop now?”

In one tweet, Andreessen revealed the perhaps hitherto unspoken agenda of the Silicon Valley oligarchs, which The Atlantic summed up most eloquently: Facebook and the New Colonialism Today’s empires are born on the web, and exert tremendous power in the material world. Read More...

Ever notice that Facebook doesn’t have a ‘dislike’ button? You can ‘unlike’ something, once you’ve liked it, but you’re not allowed to ‘dislike’ a post. Dissing is evidently verboten. Bret Easton Ellis recently posted a piece on Living in the Cult of Likability and, let’s face it, your posts are defining your ‘brand,’ lest we forget that you are the product, after all. “Instead of embracing the true contradictory nature of human beings, with all of their biases and imperfections, we continue to transform ourselves into virtuous robots. This in turn has led to the awful idea — and booming business — of reputation management, where a firm is hired to help shape a more likable, relatable You. Reputation management is about gaming the system. It’s a form of deception, an attempt to erase subjectivity and evaluation through intuition, for a price,” says Ellis.

We know what’s in the water in Flint, MI, but not always so sure about Silicon Valley. It also may well be something that they’re smoking.

This isn’t about valuations or the expanding graveyard of unicorpses. It’s about the possible end of this iteration of technology, and it’s not necessarily due to collapsing world economies ( The Shipping News Says the World Economy Is Toast - Bloomberg). FastCompany published a piece this week about Silicon Valley's Problem-Solving Bubble: The insanity of gas-delivery startups and what they say about inconvenience inflation. They were referencing WeFuel, a California-based startup that eliminates the need to stop for gas, which is somehow ‘a major impediment to life. "We all lead busy lives, running to and from appointments and trying to balance time with work and family," explains a video from WeFuel competitor Filld. "Something always gets in the way: the gas station."’